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West Town Bus Co. v. Street Elec. Ry. Employees

JULY 1, 1960.




Appeal from the Circuit Court of Cook county; the Hon. THOMAS E. KLUCZYNSKI, Judge, presiding. Affirmed.


Rehearing denied July 26, 1960.

This is a declaratory judgment action by plaintiff, an employer, to impeach a wage dispute arbitration award favorable to the defendant Union, and to restrain its enforcement. The court sustained defendants' motion to strike and dismissed the complaint. Plaintiff appealed to the Supreme Court, which transferred the cause to this court.

The transfer of the appeal disposed of constitutional questions. Defendants' motion to strike and dismiss admits all facts well pleaded (Bush v. Babb, 23 Ill. App.2d 285, 162 N.E.2d 594), and although the complaint, as amended and supplemented, is construed strictly against plaintiff, it is entitled to all reasonable inferences which can be drawn from the well-pleaded facts. Field v. Oberwortmann, 14 Ill. App.2d 218 (1957), 144 N.E.2d 637.

Plaintiff, West Towns, is a public utility, operating a motor bus system for transportation of passengers for hire. The Union, members of which operate the motor busses of plaintiff, is an unincorporated association with about 10,000 members. A collective bargaining agreement, covering wages and working conditions of the employees, was entered into between West Towns and the Union on June 1, 1948, and covered the period from June 1, 1948, to May 31, 1949. Supplemental agreements thereafter covered terms of one or two years. The sixth supplemental agreement covered the period from June 1, 1956, to May 31, 1958.

Being unable to agree on a renewal contract because of wage and fringe benefit disputes, the parties executed an arbitration agreement on October 31, 1958, with the provision that any award "shall be retroactive to and effective as of June 1, 1958." The board of arbitration was composed of three members — Evan J. McIlraith, appointed by West Towns, O. David Zimring, appointed by the Union, and these two, in turn, selected a third member, J. Russell Christianson, who was "to act as Impartial Arbitrator and Chairman of the Board of Arbitration." Each party agreed to "pay the expense of its arbitrator," and the compensation of the third arbitrator and joint expenses to be borne equally by the parties.

The board convened on December 9, 1958, heard oral arguments on December 12, 1958, and then took the matter "under advisement." On December 16 and 17, 1958, the three arbitrators met and attempted to agree on an arbitration award. They were unable to agree on an award and on December 17, 1958, unanimously agreed that the arbitration was terminated and separated.

After the separation of the three arbitrators, chairman Christianson sent to West Towns and to the Union a letter dated December 17, 1958, in which he stated, among other things, that "at a final Executive Meeting of the Board of Arbitration . . . motions for an Arbitration Award were presented by each of the three arbitrators and no one of said motions was seconded by any other arbitrator." It also stated: "It is the unanimous opinion of this Board of Arbitration that under the terms of paragraph 5 of the Arbitration Agreement, which provides that the Award must be reached by a decision of a majority of the Board of Arbitration, that if such a decision cannot be reached, arbitration proceedings are therefore terminated without a decision or an Award. In the near future, the Chairman will present an opinion to both parties and either of the arbitrators may present similar opinions to both parties."

The next morning, December 18, 1958, Evan J. McIlraith, arbitrator appointed by West Towns, left Chicago for Florida, after informing the other two arbitrators of his plans. He remained outside of Illinois until January 19, 1959. That afternoon, December 18, 1958, West Towns was notified by the Union that Zimring had resigned as arbitrator, and the Union had appointed Thomas Shields to act as its arbitrator in place of Zimring. Later, on the same afternoon, the attorney for West Towns notified the Union and chairman Christianson that it objected to the substitution of Shields, who "is not, at this time and under these circumstances, competent to act as a substitute arbitrator and that he has no power or right in the matter."

On the afternoon of December 19, 1958, at 2:59 p.m., the attorney for West Towns notified chairman Christianson that a telegram, addressed to McIlraith, had been received at the company office of West Towns, giving notice of a meeting of the arbitrators at 3:00 p.m. that day, at Christianson's office. The attorney objected to the holding of a meeting of the arbitrators, because at a "final Executive Meeting" held by the board of arbitrators, the arbitration was terminated, and that "Mr. McIlraith, as was known to you and Mr. Zimring," left for Florida on the morning of December 18, "for the Christmas holidays." He stated that it was the position of West Towns that the authority of the board of arbitrators to make an award "had terminated prior to the alleged substitution of Mr. Shields and cannot thereafter be revived."

On December 19, 1958, chairman Christianson and Shields, acting as a board of arbitration, executed an arbitration award, in which it is related that "The Board of Arbitration met, conducted extensive hearings, resulting in 579 pages of testimony, and 34 number of exhibits for the Association, and 22 number of exhibits for the Company." The Union prepared and on December 22, 1958, forwarded to West Towns a seventh supplemental agreement, which incorporated the terms of the arbitration award, effective as of May 31, 1958, and until May 31, 1959.

On December 22, 1958, West Towns moved the board to vacate and set aside the award and, in substance, stating that the award was illegal and void. West Towns persisted in its refusal to accept the award and on February 14, 1959, the Union notified McIlraith, as president and general manager of West Towns, that the Union members employed by West Towns would suspend work on February 23, 1959.

West Towns' complaint, filed on December 31, 1958, includes, as exhibits, copies of all documents and letters. On April 6, 1959, after a hearing, the court sustained a motion to strike and dismiss the complaint, as amended and supplemented, and decreed that the arbitration award was valid and binding upon the parties.

The question before us is whether the complaint, as amended and supplemented, states a cause of action sufficient to bring it within the provisions of section 57.1 of the Civil Practice Act. The principal subordinate question is whether the original arbitrators, lacking a majority agreement on an award, without notice to or prior consent of the parties to the submission agreement, could ...

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