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In re Application of Waterfront Commission

Decided: March 4, 1963.


For affirmance in part and reversal in part -- Chief Justice Weintraub, and Justices Jacobs, Francis, Proctor, Hall, Schettino and Haneman. Opposed -- None. The opinion of the court was delivered by Proctor, J.


[39 NJ Page 440] This is a consolidated appeal from two judgments of the Superior Court, Law Division, adjudging each of the defendants, John Moody, Sr., and William Murphy, guilty of civil and criminal contempt for failing to testify pursuant to subpoenas issued by the Waterfront Commission of New York Harbor (Commission). The judgments fined the defendants $50.00 each and sentenced them to 30 days in jail. The judgments further ordered that the subpoenas be

obeyed by the giving of responsive answers before the Commission to the questions set forth therein, and that the defendants be incarcerated until they answer those questions. The judgments also provided for a stay of execution pending appeal, the defendants having previously posted bonds.

We certified the defendants' appeal before argument in the Appellate Division.

This is the second time that the defendants have been adjudged in civil contempt for their refusal to testify pursuant to the afore-mentioned subpoenas. Briefly, the history of this litigation is as follows: One James H. Markley was an investigator for the Commission, assigned principally to cover the piers of the American Export Lines in Hoboken, New Jersey. On or before May 16, 1960, Markley left the employ of the Commission in order to work for the American Export Lines as a security officer, and obtained a license from the Commission to operate as a port watchman. On Monday, May 16, 1960, the day Markley commenced work for the American Export Lines on its Hoboken piers, the longshoremen employed by American Export Lines on those piers did not report for work. This work stoppage, except for the morning of Tuesday, May 17, continued through Friday, May 20, 1960. The striking employees were members of Hoboken Local No. 2 of the International Longshoremen's Association (ILA). The defendant Moody is an organizer of the ILA in New Jersey, and the defendant Murphy is the business agent of Local No. 2.

Under our Waterfront Commission Act, N.J.S.A. 32:23-1 et seq. (the New York counterpart is New York Laws 1953, c. 882, c. 883 McK. Unconsol. Laws, ยง 9801 et seq.), the longshoremen who participated in this work stoppage are required to be and are registered with the Commission. N.J.S.A. 32:23-27. Also, under the act, Markley, as a security officer of American Export Lines is required to be licensed as a port watchman. N.J.S.A. 32:23-39.

The Commission had information that the work stoppage was "a concerted effort to keep James H. Markley off the

piers of the American Export Lines." Accordingly, the Commission instituted an investigation to determine whether any persons registered with or licensed by the Commission were violating the Waterfront Commission Act by coercing an employer to limit the functions of, or to discharge, a licensed port watchman. In connection with its investigation, the Commission duly served the defendants with subpoenas on May 18, 1960, ordering them to appear and testify at the Commission's offices in New York City. The defendants appeared at the offices of the Commission in response to the subpoenas on May 19, 1960. At the hearing, Moody, after giving his name and address and testifying that he was a union official, refused to answer any further questions. Murphy testified that he was business agent of Local No. 2 and represented members of the local working at the Hoboken piers of the American Export Lines. He said he knew that the longshoremen did not work on May 16, 1960, and that it was common knowledge that for some time before that day things were not normal at the American Export Lines. However, he refused to say whether those conditions were related to the employment of Markley as a port watchman, and he refused to answer any other questions. Both defendants expressly declined to assert their privilege against self-incrimination, although they were specifically asked if that was one of the grounds for their refusal to testify. The primary reason for their refusal to testify was their assertion that the Commission had no statutory authority to investigate the work stoppage because it involved a labor dispute over which the National Labor Relations Board had exclusive jurisdiction.*fn1

Thereafter, the Commission instituted contempt proceedings against the defendants in the Superior Court, Law Division, which resulted in judgments dated June 20, 1960, holding

the defendants guilty of civil contempt and ordering that they be fined $50.00 each and that they be incarcerated until they obeyed the Commission's subpoenas. These judgments were affirmed by this court, and the United States Supreme Court dismissed the defendants' further appeal and also denied certiorari. In re Application of Waterfront Comm. of N.Y. Harbor, 35 N.J. 62 (1961), appeal dism'd and cert. den. sub nom. Murphy v. Waterfront Commission of New York Harbor, 368 U.S. 32, 82 S. Ct. 146, 7 L. Ed. 2 d 91 (1961).

Pursuant to the mandate of this court in the above contempt proceedings, the defendants appeared before the Superior Court, Law Division, on October 3, 1961. The court directed the defendants to appear before the Commission pursuant to the May 1960 subpoenas. Later that day, the defendants appeared at the offices of the Commission as directed. However, except to give their names, addresses and occupations, the defendants again refused to answer any questions, this time upon a number of new objections including the privilege against self-incrimination. All of the objections were overruled by the Commission except the assertion of the privilege against self-incrimination. The hearing was then adjourned and the subpoenas were continued until October 10, 1961, so that the Commission could decide whether to grant the defendants immunity from prosecution pursuant to N.J.S.A. 32:23-86(5) of the Waterfront Commission Act, and if so, to afford the Commission an opportunity to give notice to the appropriate officials as required by that subdivision.

On the following day (October 4, 1961) the defendants and the Commission's representative appeared before the Law Division. The court found that the defendants had obeyed the subpoenas, and that their assertion of the privilege against self-incrimination had been recognized by the Commission as a valid basis for their refusal to answer the Commission's questions. The court held that, since the defendants had complied with the judgments of the court entered June 20,

1960, they had purged themselves of contempt. However, the court also directed that the defendants should continue to be subject to the subpoenas, and that the defendants appear before the Commission on the adjourned return date (October 10, 1961).

The return date of the subpoenas was further adjourned with the consent of the parties until October 27, 1961, at which time the defendants appeared at the offices of the Commission. At the outset of this meeting, Myles J. Ambrose, Executive Director of the Commission announced, "The purpose of the meeting is to inquire into violations of the Compact in connection with a work stoppage in May, 1960, at the American Export Line piers in Hoboken, New Jersey."

The following documents were made part of the record: (1) letters (pursuant to N.J.S.A. 32:23-9) from the Commissioners designating Ambrose and William P. Sirignano, the Commission's General Counsel, to act in the places of Commissioners Harold R. Tyler, Jr., and David C. Thompson in the investigation wherein Murphy and Moody were subpoenaed, and to confer immunity upon them pursuant to N.J.S.A. 32:23-86(5); (2) copies of letters sent pursuant to N.J.S.A. 32:23-86(5) to the Attorney-General of New York and New Jersey, to the District Attorney of New York County and to the Prosecutor of Hudson County, together with certificates of mailing, notifying them of the Commission's intention to confer immunity upon Murphy and Moody; and (3) letters of reply received from all of the above-named officials except the Prosecutor of Hudson County, stating that each had no objection to the Commission's proposed grant of immunity to the defendants. No reply was received from the Prosecutor of Hudson County.

Counsel for the defendants objected to the legality of the proceedings on the ground that the Commissioners could not delegate the power to grant immunity to their designees, Ambrose and Sirignano. They also challenged the adequacy of the letters of notice sent to the officials of the two States. They further demanded a statement apprising them of the

purpose and pertinency of the interrogation, contending that the Commission's failure to give them such a statement deprived them of due process of law. All these objections and demands were rejected.

Thereafter, the defendants each took the stand and, after stating his name and address, each refused to answer any further questions on the ground that his answers might tend to incriminate him. Thereupon the Commissioners' designees granted immunity to each of the defendants pursuant to N.J.S.A. 32:23-86(5) against prosecution in the States of New York and New Jersey concerning any transaction to which they would testify, and directed the defendants to answer each of the questions. All of the questions pertained to the defendants' knowledge or actions in connection with the May 1960 work stoppage. The defendants again refused to answer for all of the reasons stated above, and particularly because the grant of immunity did not protect them against federal prosecution.

The Commissioners' designees expressly recognized that the grant of immunity did not extend to federal prosecution, but nevertheless directed the defendants to answer, saying that there was no requirement that the immunity extend that far. Upon the defendants' further refusal to answer, the Commissioners' designees directed the attorney for the Commission to institute contempt proceedings against the defendants.

The Commission initiated the present proceedings by moving before the Law Division that the defendants "be punished as for a civil and criminal contempt of court." Annexed to the moving papers were numerous exhibits depicting the prior history of the matter and including transcripts of the proceedings before the Commission on October 3, 1961, and October 27, 1961. In response to the Commission's motions, the court issued orders on November 1, 1961, directing the defendants to show cause why they should not be punished as for a contempt of court. The defendants filed an answer to the Commission's motions in which they denied all the allegations, and raised the following separate defenses:

(1) failure of the Commission to grant immunity against federal incrimination; (2) improper delegation by the commission of the power to confer immunity; (3) insufficient notice to the officials of the respective States; (4) failure to explicitly confer immunity as to each question asked; (5) pre-emption of the subject matter of the investigation by the Federal Labor Management Relations Act; and (6) inadequate apprisal of purpose and pertinency, resulting in a denial of due process of law. The defendants also moved for a bill of particulars or, in the alternative, an order requiring answers to interrogatories. These discovery motions sought to compel the Commission, in effect, to produce for the defendants' inspection its entire investigative files relating to the work stoppage investigation, including intra-office communications as well as communications between the Commission and any state or federal officials. Defendants also demanded a jury trial and, lastly, moved to quash the subpoenas as having been exhausted when the defendants were purged of their prior contempt.

The matter was heard before the Law Division on November 21 and 22, 1961. The court heard extensive argument from both sides on the above motions and defenses. However, the trial judge announced that he was "not going to receive any testimony," and said he was "going to decide it [the case] on the record as I've got it." Later the court reconsidered its ruling and concluded that it would receive the testimony of the defendants for the limited purpose of pinpointing their fear of possible federal incrimination. Murphy's testimony concerning the basis for his fear of federal incrimination was as follows:

"Q. What crimes could you possibly have been connected with as to result in a Federal charge against you or others, in combination with others, in conspiracy with others? A. That the American Export Lines is subsidized by the United States Government and could be sued, the union could be sued, and I could be sued, personally. Interstate commerce freight that was held up during the strike would bring in the Federal Bureau of Investigation, and the rights of watchmen

working on the piers that could be in cahoots in pilferages, and stuff like that.

Q. Also, were you aware of the fact it was the contention of the Waterfront Commission that you tried, and others together, in combination and conspiracy, to keep an individual from employment on the piers, namely, Mr. Markley? A. That's right.

Q. And was that a reason for your exercising that privilege, yourself? A. That's right."

Moody's testimony concerning the basis for his fear of federal incrimination was as follows:

"Q. And you exercised your privilege as you have just testified out of fear of incrimination of any Federal laws? A. That's right.

Q. Will you tell the Court what you feared and pinpoint them and the respect? A. First, from the Waterfront Commission, they have, what they say, the right and authority to question. Now, there's, we say, pilferage, that they say, work stoppage, we had to do with the pilferage and we had to do with the work stoppage; and the watchmen being not in the ILA, outside the ILA, that we tried to tell the watchmen what to do and what not to do, and to stop this one gentleman from getting hired on the pier. We don't do that, your Honor.

Q. You have just testified that the American Export Lines are engaged in interstate commerce, is that correct? A. That's right.

Q. And that this stoppage, as contended by the Waterfront Commission was an illegal stoppage, was an interference with ...

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