[267 NJSuper Page 425] This is a labor dispute in which plaintiff seeks to restrain defendant Union from arbitrating a grievance based on the claim
that the arbitration demand was untimely. To resolve that claim, it is first necessary to determine whether the timeliness issue should be decided by this court or by the arbitrators. Both parties agree that this threshold issue may be decided summarily. R. 4:67-2.*fn1
Plaintiff, Casino Distributors, Inc. (Casino) is a distributor of newspapers, magazines and sundries in the Atlantic City area. On September 8, 1992, Casino discharged one of its employees, David Carmen, allegedly for cause. Carmen is a member of the Teamsters Local 331 (Union) and is the beneficiary of a collective bargaining agreement (agreement) which includes a grievance procedure and an arbitration clause. Since the Union disputes plaintiff's claim that Carmen's discharge was for cause, it has invoked those provisions of the agreement.
On September 10, 1992, a grievance hearing was held in which the Union sought Carmen's reinstatement plus unused sick time and back pay. Casino refused to reinstate but did agree to pay, and did in fact pay, so-called liquidation wages. The Union was not satisfied and on September 14, 1992 it notified plaintiff of its intention to file for arbitration. A formal demand to the American Arbitration Association (AAA) was filed on September 28, 1992. Plaintiff responded by claiming that Carmen's acceptance of the liquidation pay constituted a settlement and that the request for arbitration was barred because the demand was filed outside the time limits set forth in the collective bargaining agreement.*fn2 This action followed.
The grievance procedure under the collective bargaining agreement contemplates a three-step process. All grievances must be initiated within five calendar days of the incident giving rise to the grievance. Only where the grievance remains unresolved after steps one or two may the matter be referred to arbitration. In such a case, the referral must be made within ten calendar days of the completion of step two (not counting weekends and holidays). Arbitrators are then selected in accordance with the procedures of the AAA.
Given the above, it is clear that the Union's initial invocation of the grievance procedure was timely. Plaintiff does not suggest otherwise. Nor does plaintiff deny that Carmen's discharge is an appropriate subject for arbitration. However, because the Union's demand to the AAA did not occur until September 28, 1992, two calendar days beyond the ten-day limit for "referrals," plaintiff claims that the demand was too late and that the right to arbitration was waived. In response, defendant claims that its September 14, 1992, notice advising plaintiff of the decision to arbitrate satisfied the terms of the agreement. Defendant also claims that even if its demand to the AAA is considered late, that would not constitute a waiver. Both sides agree that before these claims can be resolved, it is first necessary to determine whether the issues must be decided here or as part of the arbitration.
Generally it is for the courts, not the arbitrator, to decide whether parties are contractually obligated to arbitrate a particular dispute. Board of Educ. of Bloomfield v. Bloomfield Educ. Ass'n, 78 N.J. 144, 153-54, 393 A.2d 278 (1984); Laborers' Int'l Union v. Foster Wheeler Corp., 868 F. 2d 573 (3d Cir.1989). Such determinations, however, are usually limited to whether the grievant has asserted a claim which is fairly encompassed within the arbitration clause. Clifton Bd. of Educ. v. Clifton Teachers Ass'n, 154 N.J. Super. 500, 503-04, 381 A.2d 1226 (App.Div.1977). Although parties are bound only to the extent of their agreements and have a right to stand on the precise terms of those agreements,
public policy favors arbitration and contracts are to be read liberally to find arbitrability. Brick Tp. Mun. Util. Auth. v. Diversified R.B. & T. Constr. Co., 171 N.J. ...