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Antonioli v. Lehigh Coal and Navigation Co.


November 30, 1971


Van Dusen, Aldisert and Gibbons, Circuit Judges.

Author: Van Dusen


This case is before the court on appeal from a district court order of December 30, 1970, granting summary judgment for defendants on Counts I and II of the complaint and dismissing Count III, without prejudice, for a lack of standing to sue, after both plaintiffs and defendants had filed motions for summary judgment.

On September 26, 1961, the Interstate Commerce Commission, pursuant to 49 U.S.C. § 5(2), approved the abandonment of all but 40 miles of the track of the Lehigh and New England Railroad (Railroad) and the sale of the remaining 40 miles to the Lehigh and New England Railway (Railway).*fn1 In order to meet its statutory duty under 49 U.S.C. § 5(2)(f) to "require a fair and equitable arrangement to protect the interests of all the railroad employees affected," the ICC prescribed the labor protection conditions set out in New Orleans Union Passenger Terminal, 282 I.C.C. 271 (1952).*fn2 This appeal is from a district court order denying the claims of former employees of Railroad to allowances for furloughs and dismissals resulting from the abandonment and merger based on alleged non- compliance with the ICC protective order.

The complaint is set out in three counts and seeks a mandatory injunction to compel arbitration of the disputes.*fn3

Count I

Plaintiffs in Count I seek compulsory arbitration of their claims for displacement and severance benefits under the ICC protective order. The district court opinion of December 30, 1970, granting summary judgment on Count I, held that plaintiffs in Count I consisted of the workers of Railroad who were furloughed prior to the effective date of the consolidation. These furloughs allegedly occurred as the result of a plan to divert the traffic of Railroad in order to give the impression that Railroad was losing business as a result of general economic conditions, rather than as a result of the impending consolidation. On this appeal, plaintiffs have maintained that the closing date for determining membership in Count I is the effective date of the merger. They contend that Count I includes all those employees who were on the payroll of Railroad at the time of the merger and received less than the full benefits mandated by the ICC protective order.*fn4 An analysis of the record which was before the district court at the time it ruled on the summary judgment motions indicates that the closing date for determining membership in Count I was January 1959,*fn5 and that the composition of Count I was narrowed to include only those employees on the January 1959 payroll who were furloughed prior to the effective date of the merger. Plaintiffs' sole theory of relief for Count I is that employees were furloughed in anticipation of and prior to the consolidation.*fn6 In the district court order of December 30, 1970, leave was granted to amend the complaint within 30 days to clarify the class of plaintiffs in Count I. Plaintiffs failed to file a timely amendment to the complaint.*fn7

The district court found that as a matter of law all of plaintiffs' claims in Count I were barred by the statute of limitations and the doctrine of laches in view of the six-year limitation period established by Pennsylvania law.*fn8 The alleged wrongs in this Count, the furloughing of employees in anticipation of the consolidation, all must have occurred prior to the effective date of the consolidation, November 1, 1961. The instant action was not filed until November 4, 1968, and is thus barred by the six-year limitation period.

Plaintiffs argue that the rights of the affected workers are vested rights of a continuous nature and thus not barred by the statute of limitations. The analysis of the four-year protective period as creating a vested right to compensation which continues until such period terminates is rejected. It is clear from the face of the statute that the congressional mandate is to provide a four-year job protection period and not to create a vested right to compensation.*fn9 The protective order issued by the ICC as a condition of the merger imposed a duty on the Railroad to insure that employees would not be adversely affected by the merger and provided a scale of compensation for violations of that duty. There is no vested right to compensation as plaintiffs allege, but rather a right to protection from changes in employment status resulting from the merger.

The time of the accrual of the cause of action*fn10 is a federal question to be determined by reference to federal law.*fn11 The cause of action in the instant case accrued on the alleged date that the duty was breached, which was the date of the furloughs.*fn12

Count II

Plaintiffs in Count II are 22 former employees of Railroad who retired at the time of the consolidation. In October of 1961 the president of Railway notified his employees of the pending consolidation and offered to pay lump sum severance benefits to any man over the age of 65 who would voluntarily retire. The 22 plaintiffs in this Count signed retirement agreements and, later, releases. Both of these documents stated that the employees waived all rights under the ICC order of September 26, 1961. The district court, in granting defendants' motion for summary judgment, held that by signing these documents plaintiffs had waived any rights to compensation under the ICC order and that their claims were barred by the statute of limitations.

Plaintiffs' claim is barred by the applicable Pennsylvania six-year statute of limitations, 12 P.S. § 31. The cause of action for compensation under the ICC order accrued upon severance in 1961 and this action was not filed until 1968. Plaintiffs assert that the statute of limitations should not have begun to run in 1961 because they had no knowledge of their rights under the ICC order. The releases and notices of retirement were entered in the record and are cognizable on a motion for summary judgment.*fn13 The record does not show the invalidity of these documents and does not establish a lack of knowledge by plaintiffs' class of rights under the ICC order. The validity of these documents as evidencing a knowing and intelligent waiver of rights is established by this record.*fn14 Therefore, plaintiffs' claim must fall on the additional ground of the existence of a valid waiver of the asserted rights.*fn15

Count III

A collective bargaining agreement providing for compulsory retirement at age 65 was entered into in January of 1962 by Railway and the three local unions which represented its employees.*fn16 Plaintiffs in Count III are the 30 employees who were forcibly retired pursuant to these agreements. Their complaint is that they were deprived of severance pay benefits*fn17 under the ICC protective order and they seek the convocation of a Special Board of Adjustment, as provided for in the 1966 amendments to § 3 of the Railway Labor Act, 45 U.S.C. § 153, to arbitrate this severance pay dispute. The claim for severance pay is based specifically on § 7(a) of the Washington Job Protection Agreement, which provides for the payment of a "coordination allowance" to an employee who is "deprived of employment" as the result of a coordination.*fn18 In order for plaintiffs to prevail on this claim, it is necessary for them to prove that the compulsory retirement agreement was invalid or illegal.*fn19 In light of the prior decisions in Roberts v. Lehigh & New England Railway Co., 211 F. Supp. 379 (E.D. Pa. 1962), aff'd, 323 F.2d 219 (3d Cir. 1963), and Clemens v. Central Railroad Co. of New Jersey, 399 F.2d 825 (3d Cir. 1968), cert. denied, 393 U.S. 1023, 21 L. Ed. 2d 567, 89 S. Ct. 633 (1969), such an attack on the validity of the retirement agreement is barred by the principles of res judicata and the doctrine of the law of the case.*fn20

Res judicata makes conclusive a final, valid judgment; and if the judgment is on the merits, precludes further litigation of the same cause of action by the parties or their privies.*fn21 In the Roberts case there was substantial identity of the parties with those in the instant action.*fn22 There is no question that the Roberts judgment was final and valid but plaintiffs assert that it was not rendered on the merits and does not involve the same cause of action.

This court in Clemens decided both of these issues adversely to plaintiffs. The court found that in both actions (Clemens and Roberts) the same parties had complained of substantially the same wrong: their involuntary retirement without severance pay pursuant to the contract between the railroad and the Brotherhoods. In the Clemens case plaintiffs sought a mandatory injunction compelling arbitration and based their complaint on a violation of the ICC protective order issued pursuant to 49 U.S.C. § 5(2)(f). In the Roberts case the relief sought was a declaratory judgment that the forced retirement was invalid and a violation of the Railway Labor Act, 45 U.S.C. § 153, was alleged. Clemens held that to allow the differences between Roberts and Clemens to constitute a separate cause of action would "unduly shorten the reach of res judicata."*fn23 The court relied on its prior decision in Williamson v. Columbia Gas & Electric Corp., 186 F.2d 464 (1950), for the proposition that "the fact that different statutes are relied on does not render the claims different 'causes of action' for purposes of res judicata." 186 F.2d at 468. We agree with the court's reasoning in Clemens and find it persuasive when applied to the facts of this appeal. Here the same wrong is once again alleged by the same parties but a new form of relief, the convocation of a Special Board of Adjustment, is sought. This is clearly the same cause of action as that ruled on in the former Roberts decision.

Also, this court's decision in Clemens held that the decision in Roberts was rendered on the merits. The court in Clemens noted that the district court had refused to apply the doctrine of res judicata because of a finding that the decision in Roberts was based on a lack of jurisdiction under the Railway Labor Act and thus not a decision on the merits. In rejecting this position the court stated:

"This approach overlooks the fact that in Roberts we passed on the merits of the issue of the legality of the 1962 contract, which was before us for substantive determination, before reaching the question whether any additional question about the 'interpretation' of the contract should be left to administrative determination." 399 F.2d at 827.

An examination of the Roberts opinion indicates that the court was careful to limit its ruling that it lacked jurisdiction only to questions involving the interpretation of the agreement and not to those involving its validity.*fn24 The court then went on to reject each of plaintiff's asserted grounds for determining the agreements to be invalid and held that the agreements were valid.*fn25

Accordingly, we conclude that plaintiffs are barred from asserting the invalidity of the retirement agreements by the doctrine of res judicata. Even if we were to accept plaintiffs' allegations that res judicata is not proper in this case, we would be bound under the doctrine of the law of the case by the court's prior decision in Clemens. As stated by the late Judge Jones for this court,

"The former decision of this court became the law of the case and, once the law of a case is settled by an appellate court, it is settled for that tribunal as well as for the trial court, save for new or different facts. . . . A second appeal may not be used to raise questions in the same case already put at rest by the same court upon a prior appeal."*fn26

For the reasons stated above, the December 30, 1970, district court order will be affirmed insofar as it granted summary judgment for defendants on Counts I and II (paragraphs 3 and 4), but will be amended to enter judgment for defendants on Count III (paragraph 5).

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