Civil action. On complaint.
This is an action filed by the individual plaintiffs as members of Industrial Union of Marine and Shipbuilding Workers of America, Local #1, hereafter referred to as the "Local," for and on their own behalf and allegedly on behalf of all other members of said union. The matter is as well entitled in the name of Industrial Union of Marine and Shipbuilding Workers of America, Local #1, and unincorporated association, as plaintiffs, and seeks to enjoin the individually named defendants, who were officers and trustees of said Local on September 28, 1948, from representing themselves as members or officers of said union and from exercising any of the powers as said alleged officers. Plaintiffs seek also to restrain the individual defendants from acting as officers or stockholders of the Shipbuilders' Educational Society and the Lester Investment Company, both being corporations admittedly holding title to real estate or personalty in trust for the said Local, and to restrain the New York Shipbuilding Corporation and the other named financial institutions from paying over to the individually named defendants who claim to be the officers and trustees of the said Local, and the officers of the Shipbuilders' Educational Society and the Lester Investment Company any funds in their possession.
Briefly stated, the object of the litigation is an attempted ascertainment of whether the plaintiffs or the defendants and the members of the Local whom they are alleged to represent are properly to be considered the Local.
On the original application the court granted a temporary restraining order and an order to show cause why an interlocutory injunction should not issue. This is the return day of
the order to show cause whether the interlocutory injunction should so issue.
For the purpose of convenience, the Industrial Union of Marine and Shipbuilding Workers of America will be designated as the National.
From the affidavits, the following set of facts were developed: In October 1933 the Local, an unincorporated association, was organized to represent the workers in the yard of the New York Shipbuilding Corporation in Camden, New Jersey. Thereafter, and allegedly through the efforts of said Local, the National was organized in September 1934. On January 14, 1934 the Local adopted its original by-laws, which were subsequently amended. On September 30, 1934 the National adopted by-laws, which were as well subsequently amended. The Local became affiliated with the National subsequent to its organization. For some years the relationship seemed to have been amicable but in recent years a portion of the membership of the Local became dissatisfied with the conduct of the National in two particular and especial respects: (1) The constitution of the National provided, as one of its cardinal principles, that it opposed craft unionship and was in favor of "one industry, one union," and that its jurisdiction should extend to "all workers employed in ship building, ship repairing, marine maintenance industry and industries producing marine equipment and allied enterprises." It as well provided that after September 26, 1942 no employee of any other industry should be admitted to membership unless the application were approved by the general executive board of the National. The dissentient members of the Local contend that these basic principles were flagrantly violated by admitting to membership in the National, organizations of turnkeys in federal penitentiaries, attendants at mental hospitals, social service workers in Y.W.C.A.'s, gas station attendants, fertilizer workers, smelting workers, watchmakers, workers in plumbing supplies manufacturing, and secretaries and clerks in government offices. (2) As a result of the admission to membership of groups not connected with the shipbuilding, etc., industry, the National vigorously opposed legislation then
pending in Congress to increase government subsidies for shipbuilding, contrary to the interest of the Local.
The dissatisfaction culminated in a meeting of the Local, held on July 30, 1948, as the result of the president having received petitions signed by 1029 members of a total membership of 3200 members. This meeting was called to discuss and act upon a proposal to disaffiliate the Local from the National. At the meeting on July 30, 1948, at which at least 2000 members were present, after what was patently a heated and acrimonious debate, a motion was made, seconded and carried without opposition referring the entire question of such disaffiliation to the Official Board of the Local. Thereafter, and until September 22, 1948 the Official Board made reports at each regular meeting to the general membership.
In accordance with the action taken at a regular membership meeting held on September 16, 1948, a special meeting of the membership was called for September 28, 1948. The notice of said meeting, signed "Official Board, I.U.M.S.W.A.-Local No. 1," reads as follows:
"This meeting is called for the purpose of acting upon the report and recommendations of the Local 1 Budget Committee, which was made at the last General Membership Meeting. A proposed budget for the six month period ending February 28, 1949 has been submitted as well as specific recommendations for the Local's financial operation during that period. It is essential that every member be present at this important meeting."
Thereafter, notice of this meeting was given in accordance with article 3, section 12 of the by-laws of the Local.
On September 24, 1948 the Official Board decided that a further report concerning these matters should be made to the general membership meeting called for September 28, 1948. Consistent therewith, the following notices were posted and served in accordance with the provisions of said by-laws:
"I.U.M.S.W.A.-Local No. 1
The following items of business are to be included on the agenda of the Special General Membership Meeting of Tuesday, September 28th:
1. Discussion and action upon a complete report and recommendations of the Negotiating Committee regarding a proposal for Sickness Insurance arrangement for Local 1 members.
2. Discussion and action upon a report by the Official Board regarding current problems of the Local.
NOTE: The above items are in addition to the item concerning the Budget Committee report to the membership.
ALL MEMBERS SHOULD BE PRESENT.
I.U.M.S.W.A.-Local No. 1."
At the meeting of September 28, 1948, at which "substantially more than 700 members attended," the following resolution was adopted:
"WHEREAS, the National Organization of the Industrial Union of Marine and Shipbuilding Workers of America has violated the cardinal principles of its constitution, particularly the principle of 'One Industry-One Union,' and has in other ways violated its constitution which is its contract with this Local:
NOW, THEREFORE BE IT RESOLVED, that this Local does hereby terminate its affiliations with the said National Organization of the Industrial Union of Marine and Shipbuilding Workers of America and that such disaffiliation be effective as of this date, September 28, 1948, and;
BE IT FURTHER RESOLVED, that the Officers of this Local constituting the Official Board of this Local be and they hereby are authorized and directed to take such actions and do all things necessary or appropriate to render immediately effective the aforesaid disaffiliation, and to continue the operation of this Local for the benefit of its members in accordance with its By-Laws as the same are being forthwith amended to conform to the disaffiliated status of this Local under this resolution."
On vote by show of hands the motion was adopted by all of the membership then present and voting, with the exception of less than 25 members, who did not vote, and eight members who voted in the negative. The plaintiffs, William H. Harker, Howard G. Wintling and Harry J. Dunn, were present at this meeting.
Plaintiffs now contend that the action taken by the membership attending was illegal in that (1) under the common law contractual rights of the members of the Local, as established by the by-laws of the Local and the constitution of the National, without the affirmative consent of the National and over the opposition of any one member of ...