No. 173.

108 S.E.2d 78 (1959)

250 N.C. 35


Supreme Court of North Carolina.

April 8, 1959.

Attorney(s) appearing for the Case

Oliver Carter, Carter & Murchison, George Rountree, Jr., Rountree & Clark, Wilmington, for plaintiff, appellant.

Craighill, Rendleman & Kennedy, Charlotte, Mulholland, Robie & Hickey, Washington, D. C., J. B. Craighill, Charlotte, James L. Highsaw, Jr., Washington, D. C., of counsel, for defendant, appellee.

HIGGINS, Justice.

At this stage of the proceeding we are concerned with allegation only, not with proof. For the purpose of testing the sufficiency of the complaint, all well-pleaded facts are deemed admitted by the demurrer. Riddle v. Artis, 246 N.C. 629, 99 S.E.2d 857; Lewis v. Lee, 246 N.C. 68, 97 S.E.2d 469; Skinner v. Evans, 243 N.C. 760, 92 S.E.2d 209; Clinard v. Lambeth, 234 N.C. 410, 67 S.E.2d 452; Sabine v. Gill, 229 N.C. 599, 51 S.E.2d 1. Do the facts so pleaded, taken as true, and liberally construed in favor of the pleader, state a cause of action? If so, the demurrer should have been overruled. Sabine v. Gill, supra; Smith v. Sink, 210 N.C. 815, 188 S.E. 631; Shaffer v. Bank, 201 N.C. 415, 160 S. E. 481.

The allegations of the complaint, by summary and by quotation, are set forth in the preliminary statement. We call attention to the substance of a few material allegations which we think, taken together, distinguish this case from those cited by the defendant as authority or sustaining the demurrer.

It appears from the record that plaintiff, at the time this action was instituted (September 25, 1956, was no longer a member of the defendant brotherhood. He alleged (1) he had been wrongfully discharged by the employer; (2) he called on the brotherhood to resist the discharge and to have him restored, and his lost wages paid. "* * * it, (the defendant brotherhood) was at all times herein mentioned required, obligated, and under a legal contractual duty to represent the plaintiff * * * and to prosecute to a final conclusion * * both administratively and judicially, his claim * * * and the plaintiff was obligated and under a contractual duty to refrain from undertaking, in his own behalf * * * the prosecution, either administratively or judicially, of any such claim." "* * * the plaintiff was required * * to execute and deliver * * * to the defendant a power of attorney in writing, authorizing and empowering the defendant and its duly accredited officers and agents as his agents and attorneys in fact (emphasis added) * * * to present, fully process and handle to a conclusion * * * in court if necessary * * * the claim on behalf of the plaintiff for restoration to service * * * reimbursement of wages lost by him as a result of the wrongful discharge."

The complaint further alleges the defendant undertook to and did prosecute the plaintiff's claim through the various administrative stages necessary to establish his rights. The employer refused to obey the order of the National Railroad Adjustment Board to reinstate the plaintiff to his former position and to pay his lost wages. The plaintiff, in effect, alleges the next and final step to restore his rights and secure his wages was by petition to the District Court of the United States for the Eastern District of North Carolina as provided in § 153, subd. 1(p) of the Railway Labor Act. By way of limitation, however, the Act provides, § 153, subd. 1(q), that the action "shall be begun within two years from the time the cause of action accrues under the award of the division of the Adjustment Board, and not after."

Finally, the plaintiff alleges, paragraphs 20 to 24, inclusive, that by written power of attorney he gave to his agent, the defendant brotherhood, the exclusive right to prosecute his claim administratively and judicially, and that the defendant having full knowledge of the two years' limitation, breached its contract to institute the action, and that he thus lost his right to compel the carrier to reinstate him and pay his wages.

As its first ground of demurrer, the defendant says: The brotherhood cannot be held responsible for the acts of its agents for the reason the agents are likewise the plaintiff's agents, he being a co-principal by reason of membership in the brotherhood. As Authority the defendant cites the following cases: Kordewick v. Brotherhood of Railroad Trainmen, 7 Cir., 1950, 181 F.2d 963; Duplis v. Rutland Aerie, No. 1001, Fraternal Order of Eagles, 1955, 118 Vt. 438, 111 A.2d 727; Marchitto v. Central R. Co. of New Jersey, 1952, 9 N.J. 456, 88 A.2d 851; Brotherhood of Railroad Trainmen v. Allen, Tex.Civ.App.1950, 230 S.W.2d 325; 148 Tex. 629, certiorari denied 1951, 340 U.S. 934, 71 S.Ct. 501, 95 L.Ed. 674; Atkinson v. Thompson, Tex.Civ.App.1958, 311 S.W.2d 250; De Villars v. Hessler, 1950, 363 Pa. 498, 70 A.2d 333, 14 A.L.R. 2d 470; McClees v. Grand International Brotherhood of Locomotive Engineers, 1938, 59 Ohio App. 477, 18 N.E.2d 812; Hromek v. Gemeinde, 1941, 238 Wis. 204, 298 N.W. 587; Carr v. Northern Pac. Beneficial Ass'n, 1924, 128 Wn. 40, 221 P. 979; Martin v. Northern Pac. Beneficial Ass'n, 1897, 68 Minn. 521, 71 N.W. 701; Gilbert v. Crystal Fountain Lodge, 1887, 80 Ga. 284, 4 S.E. 905.

The rationale of the rule in the cases cited is succinctly stated by the Court of Civil Appeals of Texas in Brotherhood of Railroad Trainmen v. Allen, 230 S.W.2d 325, 327: "The appellees and the other several hundred thousand members are principals, and we are of the opinion that one or more principals cannot sue their coprincipals and require them to respond in damages for the dereliction of duty of a joint agent." If we concede the soundness of the rule, it by no means follows that it applies to the plaintiff's case. The plaintiff alleges, in effect, that he entered into a contract with the brotherhood that it should be his agent with the exclusive right to prosecute his claim; and "the plaintiff was obligated and under a contractual duty to refrain from undertaking on his own behalf * * * the prosecution, either administratively or judicially, of such claim." When liberally construed, the complaint alleges that the plaintiff was the principal and the brotherhood was his agent, with exclusive authority, to prosecute his claim.

The plaintiff contends this case does not involve the negligence of a joint agent representing both him and the brotherhood, but it does involve the negligent failure of the brotherhood, the agent, to carry out its contract with the plaintiff, the principal. The contract is alleged. Its breach is alleged. Authority to make the contract is not now in question. Issues involving the truth of the facts alleged arise by answer, not by demurrer. On the facts alleged, we are not prepared to hold, as a matter of law, that an unincorporated labor union embracing many thousands of members, acting through its duly selected officers, lacks power to make a valid contract with one of its own members, or that the brotherhood can defeat its contract by pleading the member was a co-principal. The action against the brotherhood is authorized by G.S. § 1-69.1. Jones Construction Co. v. Local Union 755 of the International Brotherhood of Electrical Workers (A. F. of L.), 246 N.C. 481, 98 S.E.2d 852. The first ground of the demurrer is not sustained.

For its second ground of demurrer the defendant says in substance: The complaint does not state a cause of action. In short summary the complaint alleges (1) the plaintiff was wrongfully discharged; (2) the administrative procedures culminating in the order of the National Railroad Adjustment Board (Third Division) established the wrongful discharge and ordered the carrier to reinstate the plaintiff and pay his back wages; (3) the carrier refused to obey the order; (4) plaintiff had a good cause of action to compel compliance; (5) that the cause of action was lost by reason of the defendant's negligent failure to make timely application to the Federal Court to have the award enforced; (6) by reason of the defendant's failure the plaintiff was damaged as set out in paragraph 24 of the complaint. When liberally construed, the complaint states a cause of action. The second ground of demurrer is not sustained.

For its third ground of demurrer the defendant says the defendant's alleged dereliction of duty in failing to file suit did not prevent the plaintiff from filing a suit himself under the provisions of the Railway Labor Act and that the Act did not require the defendant to bring the suit The plaintiff grounds his cause of action upon the failure of the defendant brotherhood to carry out its contract with him to pursue the remedy provided by the Railway Labor Act. He alleges the brotherhood required him to forego his right to sue and that he relied on the agent to be faithful to its trust. The third ground of the demurrer is not sustained.

The court below committed error in sustaining the demurrer. The cause is remanded to the Superior Court of New Hanover County where the defendant will be permitted to answer. The trial court will then inquire into the merits of the issues raised by the pleadings.


BOBBITT, J., concurring.

PARKER, J., dissents.

MOORE, J., not sitting.

BOBBITT, Justice (concurring).

Under the Railway Labor Act, the defendant Brotherhood, not the individuals who composed its membership, became the exclusive bargaining agent of all employees of plaintiff's craft or class. Thus, the federal statute recognized the Brotherhood as a separate entity when representing an employee in respect of his employment relations with the carrier. In my opinion, when the Brotherhood, as such separate entity, assumes contractual obligations to employees relating to such representation, an employee may sue the Brotherhood as an entity for the alleged breach thereof. To this extent, the status conferred upon the Brotherhood by the federal statute seems sufficient to distinguish it from partnerships and from ordinary fraternal, civic or other unincorporated associations.

Whether plaintiff can maintain his alleged cause of action is another question, not presented for determination on this appeal.


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