On appeal from the Superior Court, Chancery Division, Bergen County.
Fritz, Gaulkin and Long. The opinion of the court was delivered by Long, J.A.D.
On this appeal, Local Union 274 of the United Association of Journeymen and Apprentices of the Plumbing and Pipefitting Industry of the United States and Canada, AFL-CIO, and Local Union 14 of the United Association of Journeymen and Apprentices of the Plumbing and Pipefitting Industry of the United States and Canada, AFL-CIO (unions) challenge a decision of the trial judge which enjoined them from seeking arbitration of issues arising out of their contract with the Allwood Plumbing & Heating Co., Inc. (Allwood).
Allwood is a plumbing and heating contractor primarily engaged in mechanical equipment service and maintenance. The unions are unincorporated labor organizations under the purview of the Taft-Hartley Act, and affiliated with the United Association of Journeymen and Apprentices of the Plumbing & Pipefitting Industry, AFL-CIO. Prior to 1983, the unions and the Mechanical Contractors Association of New Jersey (Association), of which Allwood is not a member, entered into local collective bargaining agreements. From 1975 to 1982, notwithstanding its lack of membership in the Association, Allwood was a signatory to these local agreements. (In 1983 all parties became signatories to the "National Mechanical Equipment Service and Maintenance Agreement".) Allwood claims that during the period in which the local agreements were in effect, it modified those agreements with the assent of its employees in three respects:
(1) Overtime payments on service and maintenance contracts were reduced from double time to one and a half time;
(2) Allwood was given sole discretion to determine when to use foremen on jobs;
(3) The relationship of mechanics to helper -- apprentices was reduced from an equal ratio to a one to six ratio.
On October 28, 1983 the unions invoked the arbitration clause in the local agreement alleging "wage under payments and contract breaches." Under that clause the arbitration was to take place before a panel made up equally of union members and members of the Association. On December 14, 1983 Allwood moved for a temporary restraining order to block the arbitration based on the composition of the arbitration panel, arguing that:
The employer representatives to the Joint Conference Committee are party-designated arbitrators of the Mechanical Contractors Association of which plaintiff is not a member. These arbitrators are executive members and/or officers and/or competitors of the plaintiff, and vigorously compete with the plaintiff. . . . Quite clearly, there is a commonality of financial interests among the Union party-designated arbitrators and the Mechanical Contractor party-designated arbitrators to the local Union agreements. A determination favorable to the Union position is a determination favorable to the members of the Mechanical Contractors Association since such a decision would result in the imposition upon Allwood of substantially increased rates of wages and terms and conditions of employment.
Temporary restraints were granted, after which both parties moved for summary judgment. On April 9, 1984, the trial judge granted summary judgment to Allwood and issued a permanent injunction against arbitration under the local agreement. In an opinion which falls far short of the requirements of R. 4:46-2*fn1 the trial judge declared:
The plaintiff's position is to be sustained mainly for the reasons posited by Mr. Ferrara [Allwood's counsel]. In mode and procedure created by the local (New Jersey Mechanical Contractor's association) contract as applied to these rather special facts represents an invitation to unfairness. The plaintiff, under the local arbitration agreement, is asked to defend its position before a panel comprised of individuals, fifty percent of which ...