R.J. Distributing Co. v. Teamsters, Chauffeurs & Helpers Local Union No. 627

771 F.2d 211, 120 L.R.R.M. (BNA) 2067
CourtCourt of Appeals for the Seventh Circuit
DecidedAugust 16, 1985
DocketNo. 84-2014
StatusPublished
Cited by3 cases

This text of 771 F.2d 211 (R.J. Distributing Co. v. Teamsters, Chauffeurs & Helpers Local Union No. 627) is published on Counsel Stack Legal Research, covering Court of Appeals for the Seventh Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
R.J. Distributing Co. v. Teamsters, Chauffeurs & Helpers Local Union No. 627, 771 F.2d 211, 120 L.R.R.M. (BNA) 2067 (7th Cir. 1985).

Opinion

HARLINGTON WOOD, Jr., Circuit Judge.

In this appeal, we are asked to determine whether the district court correctly concluded that a grievance filed by the Teamsters, Chauffeurs, and Helpers Local Union No. 627 (the “Union”) is not subject to arbitration under the collective bargaining agreement between R.J. Distributing Company (“R.J.”) and the Union.

I.

On May 1,1983, the Union executed, as it had for the preceding twenty years, a collective bargaining agreement with a number of companies, collectively, the Beer and Liquor Distributors of the Peoria, Illinois area. R.J. is a member of this multiemployer bargaining group. The Union represents the employees of the signatory companies. Pabst Brewing Company, which had been a member of this multiemployer bargaining group since at least 1971, withdrew in 1977. Since 1977, Pabst has negotiated and executed separate agreements with the Union.

In 1971, the Union and the Beer and Liquor Distributors negotiated “Sale of Assets” provisions which have been included in substantially the same form in all subsequent agreements between the parties. The “Sale of Assets” provisions of the 1983 agreement between the Union and the Beer and Liquor Distributors read as follows: Section 21.1:

In the event the Company, party to this Agreement, acquires work or performs services previously performed by a company not party to this Agreement, then in that event, the employees of such company not party to this Agreement shall have no rights under this Agreement, including, specifically, the right to go with the work and acquire seniority under the terms and provisions of this Agreement, except as new employees. Section 21.2:
In the event that this Company, party to this Agreement, acquires work or performs services previously performed by another company who is also a party to this Agreement, then in that event, the employee so affected shall have the right to follow the work, and shall retain benefits and rights previously in effect with their former Company.

The corresponding sections of the 1983 agreement between the Union and Pabst are identical.

[213]*213On August 9, 1983, Pabst and R.J. entered into an agreement whereby R.J. agreed to purchase Pabst’s distribution operation in the Peoria area. On August 25, 1983, the Union filed a grievance against R.J., claiming that under section 21.2 of the 1983 agreement between the Union and the Beer and Liquor Distributors, the Pabst employees were entitled to employment with R.J. and to retain the benefits and seniority they had acquired during their employment with Pabst. On August 26, 1983, Pabst terminated the employment of employees represented by the Union under the Pabst agreement.

When R.J. denied the grievance, the Union sought to invoke the arbitration provisions of the agreement.

Section 13.1 provides that:

Should any controversy arise over the interpretation, application, or working conditions covered by this agreement, which cannot be settled verbally by the employee and the Company, it shall be reduced to writing no later than fourteen (14) days after such impasse is reached.

Within five-days of receiving the Union’s grievance, the Company must schedule a meeting with the Union’s business agent. Within five days of the meeting, the Company must provide the agent a written answer. Section 13.2 of the Agreement. If the dispute has not been satisfactorily resolved, the Union may request arbitration within ten days of the Company’s answer. Section 13.3 of the Agreement. Under section 13.5, “the arbitrator shall be bound by the terms and provisions of this Agreement and shall have authority to consider only grievances presenting an arbitrable issue under this Agreement.”

R.J. refused to arbitrate, and filed an action pursuant to section 301 of the Labor-Management Relations Act, 29 U.S.C. § 185, seeking a declaration that it was not required to arbitrate the dispute and that section 21.1 of the agreement applied to the controversy. The Union counterclaimed to compel R.J. to arbitrate the grievance. Both parties moved for summary judgment. Following an evidentiary hearing, R.J.’s motion was granted, the Union s motion was denied, and the case was dismissed.

The district court reasoned that the dispute was not arbitrable because the Union was asserting the interests of employees who were not covered by the agreement between the Union and the Beer and Liquor Distributors. The court held that its finding that the dispute was not arbitrable because Pabst was not a signatory to the agreement between the Union and the Beer and Liquor Distributors mandated the conclusion that Pabst employees have no rights under section 21.2 of the agreement. The Union appeals.

II.

The Union phrases the underlying disputed issue as follows: whether section 21.1 or section 21.2 governs the fate of Pabst employees following the acquisition of the Pabst Peoria area distribution operation by R.J. The resolution of this issue is dependent upon the proper interpretation of the phrase “party to this Agreement,” which is contained in both sections. The resolution of these issues, the Union claims, is resolution of the merits of the dispute. Under well-established principles of labor law, which limit a court’s authority to determining “whether the party seeking arbitration is making a claim which on its face is governed by the contract,” United Steelworkers v. American Manufacturing Co., 363 U.S. 564, 567-68, 80 S.Ct. 1343, 1346, 4 L.Ed.2d 1403 (1960), consideration of these issues was beyond the district court’s power. The district court, the Union contends, was limited to deciding whether these issues were subject to arbitration under the arbitration provisions of the agreement as “controversies ... over the interpretation” of the agreement. The Union argues that the court erred in basing its arbitrability determination on its interpretation of sections 21.1 and 21.2, the substantive provisions of the agreement that are the focus of the dispute.

Although suggesting in its brief that the issues of arbitrability and the appropriate resolution of the merits of the underlying [214]*214dispute were sufficiently distinct to permit the district court to rule on the former without becoming entangled in the latter, at oral argument, the Union, relying on this court’s recent decision in Communication Workers of America v. Western Electric Co., 751 F.2d 203 (7th Cir.1984), argued that we should compel arbitration of the arbitrability issue as well as the underlying dispute because a decision on arbitrability in this case necessarily involves interpretation of the substantive provisions of the agreement, i.e., the merits of the dispute.

Citing section 13.5 of the agreement, R.J. retorts that an arbitrator has the authority to consider only grievances arising “under this Agreement.” Because the Union filed the grievance on behalf of former Pabst employees who never worked under the R. J.-Union agreement, the grievance cannot be deemed to arise under that agreement. R.J.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Cite This Page — Counsel Stack

Bluebook (online)
771 F.2d 211, 120 L.R.R.M. (BNA) 2067, Counsel Stack Legal Research, https://law.counselstack.com/opinion/rj-distributing-co-v-teamsters-chauffeurs-helpers-local-union-no-ca7-1985.