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International Union of Elevator Constructors and Local 34 International Union of Elevator Constructors v. Home Elevator Co.

decided: August 12, 1986.

INTERNATIONAL UNION OF ELEVATOR CONSTRUCTORS AND LOCAL 34 INTERNATIONAL UNION OF ELEVATOR CONSTRUCTORS, PLAINTIFFS-APPELLANTS,
v.
THE HOME ELEVATOR COMPANY, INC., DEFENDANT-APPELLEE



Appeal from the United States District Court for the Southern District of Indiana, Indianapolis Division. No. IP 84-1154-C-William E. Steckler, Judge.

Author: Ripple

WOOD, JR., EASTERBROOK and RIPPLE, Circuit Judges.

RIPPLE, Circuit Judge.

Section 301 of the Labor Management Relations act (LMRA), 29 U.S.C. § 185(a), grants jurisdiction to the federal courts over "suits for violation of contracts between an employer and and a labor organization representing employees in an industry affecting commerce . . ." Pursuant to section 301, the International Union of Elevator Constructors and Local 34 of the International Union of Elevator Constructors (Union) filed suit in the district court alleging that Home Elevator Company (Company) had breached the collective-bargaining agreement. Relying on DelCostello v. International Brotherhood of Teamsters, 462 U.S. 151, 76 L. Ed. 2d 476, 103 S. Ct. 2281 (1983), the district court applied the six-month statute of limitations contained in section 10(b) of the National Labor Relations Act (NLRA), 29 U.S.C. § 160(b), to bar the section 301 cause of action. In following this course, the district court departed from the general practice, established in International Union United Automobile Workers v. Hoosier Cardinal Corp., 383 U.S. 696, 16 L. Ed. 2d 192, 86 S. Ct. 1107 (1966), of borrowing the most analogous state limitations period.

We do not believe that the Supreme Court's holding in DelCostello justified a departure in this case from the general approach of Hoosier Cardinal. We hold, therefore, that the district court erred by not applying the most analogous state limitations period to the section 301 suit in this case. We reverse and remand this case to the district court for application of the most analogous state statute of limitations, the Indiana two-year statute of limitations governing all actions relating to the terms, conditions governing all actions relating to the terms, conditions and privileges of employment except actions based upon a written contract. Ind. Code § 34-1-2-1.5.

I

FACTS

In November, 1977, the Union entered into a collective bargaining agreement with the Company. The agreement established the terms and conditions of employment including the wage rate and all other wage related payments. It also continued an arbitration clause to resolve all differences and disputes regarding the application and construction of the agreement. The contract expired in July 1982. However, the parties continued to bargain until they reached impass in March 1983. The Union claims that, during these negotiations, it first discovered that the Company had not paid the employees the rate established by the agreement. Rather than submitting the dispute to arbitration, the Union waited until August 1, 1984 and then filed suit under section 301 of the LMRA.*fn1 In its complaint, the Union alleged that the Company had violated the collective-bargaining agreement, and sought specific performance and damages for breach of contract. It did not petition to compel arbitration.

On July 12, 1985, the district court granted the defendant's motion to dismiss. The district court decided that the six-month statute of limitations in section 10(b) of the NLRA*fn2 was the period most conducive to federal labor policy and most applicable to the section 301 suit in this case. International Union of Elevator Constructors v. Home Elevator Co., 613 F. Supp. 253, 255 (S.D. Ind. 1985). Application of the federal statute of limitations, the court concluded, was also consistent with a desire to establish a uniform limitations period for all section 301 suits. Id. at 256. The district court concluded that Hoosier Cardinal did not control because, unlike the situation in this case, the agreement in Hoosier Cardinal did not contain an arbitration clause. Id. at 255. However, on appeal, the Union argues that the facts in this case are no materially different from those in Hoosier Cardinal, and that therefore the district court should have applied the state statute of limitations most analogous to this section 301 claim.

II

Discussion

1) General Principles

Many federal statutes, while providing a federal forum for litigation, contain no specific statute of limitations. Therefore, federal courts, faced with this lapse in the legislative process, have been forced to fill the gap left by the Congress.*fn3 Our task is to identify, in light of the purpose of the particular statute, the most analogous statute of limitations. The courts "have generally concluded that Congress intended that the courts apply the most closely analogous state of limitations under state law." DelCostello, 462 U.S. at 158. Sometimes, there is a:

direct indication in the legislative history suggesting that Congress did in fact intend that state statutes should apply. More often, however, Congress has not given any express consideration to the problem of limitations periods. In such cases, the general preference for borrowing state limitations periods could more aptly be called a sort of fallback rule of thumb than a matter of ascertaining legislative intent; it rests on the assumption that, absent some sound reason ...


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