The Birdsall-Stockdale Motor Co.

THE BIRDSALL-STOCKDALE MOTOR COMPANY 305 2. By surveillance and interrogation of its employees concerning concerted activities, thereby interfering with, restraining, and coercing them in the exercise of rights guaranteed in Section 7 of the Act, the Respondent has engaged in and is engaging in unfair labor practices within the meaning of Section 8 (a) (1) of the Act. 3. The aforesaid labor practices are unfair labor practices affecting commerce within the meaning of Section 2 (6) and (7) of the Act. - [Recommendations omitted from publication in this volume.] Appendix A NOTICE To ALL EMPLOYEL,s Pursuant to the recommendations of a Trial Examiner of the National Labor Relations Board, and in order to effectuate the policies of the National Labor Relations Act, as amended, we hereby notify our employees that : WE wu or engage in surveillance or interrogate our employees con- cerning concerted activities. WE WILL NOT in any like or related manner interfere with, restrain, or coerce our employees in the exercise of the right to self-organization, to form labor organizations, to join or assist Amalgamated Clothing Workers Union of America, C. I. 0., or any other labor organization, to bargain col- lectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection, or to refrain from any or all of such activities, except to the extent that such right may be affected by an agreement re- quiring membership in a labor organization as a condition of employment, as authorized in Section 8 (a) (3) of the Act. All of our employees are free to become, remain, or to refrain from becoming or remaining members in good standing in Amalgamated Clothing Workers Union of America, C. I. 0., or any other labor organization except to the extent that this right may be affected by an agreement in conformity with Section 8 (a) (3) of the Act. R. & J. UNnERwaex Co., INC., Employer. By ----------------------------------- Dated ------ '------------ (Representative ) (Title) This notice mustemain posted for 60 days from the date hereof and must not be altered, defaced, or covered by any other material. THE BIRDSALL-STOCHDALE MOTOR COMPANY and INTERNATIONAL Asso- CIATION OF MACHINISTS , LODGE No. 750. Case No. 30-CA-113. November 14, 1952 Supplemental Decision and Amended Order On September 11, 1952, Trial Examiner William E. Spencer issued his Supplemental Intermediate Report in the above-entitled proceed- 101 NLRB No. 83. 306 DECISIONS OF NATIONAL LABOR RELATIONS BOARD ing, a copy of which is attached hereto, finding that on or about Febru- ary 29, 1952, Johnson Pontiac, Inc., became the successor of the Re- spondent, The Birdsall-Stockdale Motor Company, and has since that time been responsible for remedying the unfair labor practices of the Respondent. He therefore concluded that the Respondent and John- son Pontiac, Inc., as successor to the Respondent, are jointly and sev- erally responsible for compliance with the terms of the Board's original Decision and Order in this case. Thereafter, the Respondent filed exceptions to the Supplemental Intermediate Report, and a sup- porting brief. The Board 1 has reviewed the rulings made by the Trial Examiner at the reopened hearing, and finds that no prejudicial error was com- mitted. The rulings are hereby affirmed. The Board has considered the Supplemental Intermediate Report, the exceptions and brief, and the entire record in this case, and hereby adopts the findings and conclusions of the Trial Examiner. Amended Order Upon the entire record in the case, and pursuant to Section 10 (c) of the National Labor Relations Act, as amended, the National Labor Relations Board hereby orders that the Respondent, The Birdsall- Stockdale Motor Company, and its successor, Johnson Pontiac, Inc., Colorado Springs, Colorado, jointly and severally, and their officers, agents, successors, and assigns, shall : 1. Cease and desist from : (a) Refusing to bargain collectively with International Associa- tion of Machinists, Lodge No. 750, as the exclusive representative of all the employees in the appropriate unit with respect to rates of pay, wages, hours of employment, and other conditions of employment. (b) In any manner interfering with the efforts of International Association of Machinists, Lodge No. 750, to negotiate for or represent the employees in the aforesaid unit as their exclusive bargaining agent. 2. Take the following affirmative action, which the Board finds will effectuate the policies of the Act : (a) Upon request, bargain collectively with International Associa- tion of Machinists, Lodge No. 750, as the exclusive representative of the employees in the aforesaid unit, and if an understanding is reached, embody such an understanding in a signed statement. (b) Post at the plant of Johnson Pontiac, Inc., Colorado Springs, Colorado, including all places where notices to employees are cus- tomarily posted, copies of the notice attached hereto and marked ' Pursuant to the provisions of Section 3 (b) of the Act, the Board has delegated its powers in connection with this case to a three-member panel [Members Houston, Murdock, and Styles]. THE BIRDSALL-STOCKDALE MOTOR COMPANY 307 "Appendix A." 2 Copies of said notice, to be furnished by the Re- gional Director for the Seventeenth Region, shall, after being duly signed by representatives of The Birdsall-Stockdale Motor Company, and Johnson Pontiac, Inc., respectively, be posted by them immedi- ately upon receipt thereof, and be maintained by them for sixty (60) consecutive days thereafter, in conspicuous places, including all places where notices to employees are customarily posted. Reasonable steps shall be taken by the said Companies to insure that said notices are not altered, defaced, or covered by any other material. (c) Notify the Regional Director for the Seventeenth Region in writing, within ten (10) days from the date of this Order what steps the Respondent, The Birdsall-Stockdale Motor Company, and its successor, Johnson Pontiac, Inc., have taken to comply herewith. Appendix A NOTICE TO ALL EMPLOYEES Pursuant to a Supplemental Decision and Amended Order of the National Labor Relations Board, and in order to effectuate the policies of the National Labor Relations Act, we hereby notify our employees that : WE WILL NOT refuse , upon request, to bargain collectively with INTERNATIONAL ASSOCIATION OF MACHINISTS , LODGE No. 750, as the exclusive representative of our employees in the unit described herein or in any manner interfere with the efforts of said union to bargain collectively with us on behalf of said employees. WE WILL bargain collectively, upon request, with the above named union as the exclusive representative of all our employees in the unit described herein with respect to rates of pay, hours of employment, or other conditions of employment ,, and if an understanding is reached , embody such understanding in a signed agreement. The bargaining unit is: All mechanics, bodymen, painters, trimmers, apprentices, and helpers at the Johnson Pontiac, Inc., plant, excluding all office and clerical employees, salesmen, guards, professional employees, and all supervisors as defined in the Act. All our employees are free to become or remain members of the above- named union or any other labor organization . We will not discrimi- nate in regard to the hire or tenure of employment or any term or 2 In the event this Order is enforced by a decree of a United States Court of Appeals, there shall be inserted before the words, "a Supplemental Decision and Amended Order" the words , "a Decree of the United States Court of Appeals Enforcing." 242305-53-21 308 DECISIONS OF NATIONAL LABOR RELATIONS BOARD condition of employment against any employee because of membership in or activity on behalf of any labor organization. TIIE BIRDSALL-STOCKDALE MOTOR COMPANY, Employer. Dated ---------- By ----------------------------------------- (Representative ) ( Title) JOHNSON PONTIAC, INC., Successor to Employer. Dated ---------- By ----------------------------------------- (Representative ) ( Title) This notice must remain posted for 60 days from the date hereof, and must not be altered, defaced, or covered by any other material. Supplemental Intermediate Report STATEMENT OF THE CASE On February 21, 1951, Trial Examiner Irving Rogosin issued his Intermediate Report and Recommended Order in the above-entitled proceeding, finding, on the basis of a stipulated record (the parties having waived a hearing), that the Respondent had engaged in and was engaging in unfair labor practices within the meaning of Section 8 (a) (1) and (5) and Section 2 (6) and (7) of the National Labor Relations Act, as amended, 61 Stat. 136, herein called the Act. On May 17, 1951, the National Labor Relations Board, herein called the Board, issued its Decision and Order in the case, finding, as did the Trial Examiner, that the Respondent had engaged in and was engaging in the afore-stated violations of the Act. By order dated July 14, 1952, and on motion of the General Counsel, the Board directed the reopening of the record and remanded the proceeding to the Regional Director for the Seventeenth Region (Kansas City, Missouri) for further hearing. Copies of the Board's order, together with notice of hearing, were served upon the Respondent, Johnson Pontiac, Inc., herein called Johnson, and International Association of Machinists, Lodge No. 750, herein called the Union. Pursuant to the aforesaid notice, a hearing was held at Colorado Springs, Colorado, on July 29, 1952, before the undersigned Trial Examiner. The General Counsel was represented by his attorney ; the Union by its lay representatives ; and the Respondent by counsel appearing specially in this proceeding only, "on behalf of a dissolved and defunct corporation." All parties were afforded full opportunity to be heard, to examine and cross-examine witnesses, and to intro- duce evidence bearing upon the issues framed by the Board's order. The Board's order, prescribing the scope and character of the hearing, directed that evidence be received on the following matters : (1) The continuing pattern of the Respondent's refusal to bargain collectively with the Union. (2) The relationship between the Respondent and Johnson Pontiac, Inc. (3) The relationship between the business conducted by the Respondent and the business conducted by Johnson. (4) The full circumstances of the sale or other transfer of the business and/or physical assets from the Respondent to Johnson. (5) The responsibility of the respective companies for remedying the unfair labor practices found in the Board's Decision and Order. THE BIRDSALL-STOCKDALE MOTOR COMPANY 309 At the commencement of the hearing, Respondent moved to quash the notice of hearing and to dismiss proceeding, on the following grounds : (1) That the Respondent ceased all business operations, was dissolved, and became nonexistent as a corporation by action of Its stockholders on June 30, 1952, under the laws of the State of Colorado. (2) That the Board having entered its Decision and Order in the case on May 17, 1951, had no authority to reopen the case for any purpose. (3) That the Board's order and the notice of hearing are void and ineffective on their face in that this proceeding proposes to determine the responsibility of companies or persons not parties to the proceeding. (4) That prior to the cessation of Respondent' s business and its dissolution as a corporation and at a time when no unfair labor practice charge against it was pending before the Board, the employees of the now dissolved and defunct corporation filed a decertification petition with the Board in which they sought the decertification of the Union as their bargaining representative. The motion was denied. As to (1) of the motion, the dissolution of the Respondent corporation subsequent to the issuance of the Board's Decision and Order cannot operate retroactively to deprive the Board of its previously estab- lished jurisdiction or in futuro in such manner as to prevent the Board from ascertaining the facts of such dissolution or changed circumstances in order to determine whether in effectuating the policies of the Act, a modification of its original Decision and Order is required.' As to (2), subsection (d) of Section 10 of the Act, "invests the Board with authority, at any time before the transcript shall have been filed in court, to modify or set aside its order in whole or in part. The purpose of the provision obviously is to afford an opportunity to cor- rect errors or to consider new evidence which could render the order inadequate or unjust." 2 As to (3), whatever responsibility is now sought to be charged against Johnson, arises out of operation of law from Johnson's relationship to the Respondent and the circumstances of the sale or the transfer of the business of the Respondent. "The requirement of due process does not entail providing a successor with an opportunity to defend against unfair labor practices committed by its predecessor prior to a transfer of the business enterprise involved.." 8 The sole issue pertaining to Johnson is its duty, arising from operation of law, to remedy the unfair labor practices of its predecessor. Service of the Board's order remanding this cause for further proceedings together with notice of hearing, fully and fairly apprised Johnson of the time, place, nature, and scope of the hearing. As to (4), a decertification petition (Case No. 30-RD-30) was filed with the Board's Regional Office in Kansas City on or about January 22, 1952, at a time when, because of the Respondent's long-continued unlawful refusal to bargain with the Union, the Union had been deprived of a reasonable period in which to function as the employees' bargaining representative.' Obviously, under such circumstances, the Union's loss of majority representation-assuming such to have been the fact-was attributable to the Respondent's unfair labor prac- tices. The Board's declination to proceed on the decertification petition therefore represented a lawful and proper exercise of its discretion under Section 9 (c) of the Act, and nowise divested it of the authority to take further evidence for determining the scope and application of its remedial order. A further objection of the Respondent going to the alleged insufficiency of the notice of hearing is without merit. The notice of hearing was issued on IN. L. R. B. v Acme Mattress Company, Inc., 195 F. 2d 524 (C. A. 7) ; N. L. R. B. v. Somerset Classics, Inc., 193 F. 2d 613 (C. A. 2). 2 In re N. L R. B , 304 U S 486, 492 The Alexander Milburn Company, 78 NLRB 750, 766-771, and cases cited therein 4 Franks Bros . Co , 321 U. S. 702, 705 310 DECISIONS OF NATIONAL LABOR RELATIONS BOARD July 18, and on that same date both the Respondent and Johnson were verbally notified, by the telephone, that the case would come on for hearing on July 29. Neither at that time raised an objection to the setting of the hearing on that date. The notices of hearing were actually received by Respondent and Johnson on July 21, a Saturday and a Sunday having intervened between the mailing and the receipt thereof, wherefore the Respondent argues that the 10-day notice required by the Board's Rules and Regulations has not been met. The argument overlooks the fact that a hearing on the complaint in this matter was waived by all parties, and that no rigid requirement of a 10-day notice is applicable to a proceeding based on a remand for further hearing. The notice given herein was a reasonable one and that the Respondent and Johnson regarded it as reasonable notice is shown by the failure of either to protest the date set for the hearing when notified of it orally on July 18, or to avail themselves of the opportunity afforded them by the undersigned at the hearing to request a continuance for the purpose of further preparation. Upon the evidence submitted, from my observation of the witnesses, and after consideration of the brief filed with me by the Respondent, I make the following : FINDINGS of FACT 1. The continuing pattern of the Respondent's refusal to bargain collectively with the Union The Respondent declined to comply with the Board's Decision and Order dated May 17, 1951, which directed it to bargain collectively, on request, with the Union, and by letter dated June 12, 1951, advised the Board's agent in the matter of compliance : The company feels that the Board does not have jurisdiction over its retail automobile business, and that its contentions in this respect should have been sustained. Until a final determination of the question it, therefore, does not feel justified in complying with the Order of the Board. The Respondent subsequently agreed to consider binding on it the decision of the court in certain other cases involving the Board's jurisdiction over retail automobile companies 6 The decree of the court in those cases, sustaining the Board's jurisdiction, issued on December 5, 1951, and the time allowed for petition for rehearing having expired without such a petition being filed, the Respondent by letter dated December 26, 1951, notified the Board's agent that notices of compliance required by the Board's Decision and Order would be posted by it on the following day. Such notices were duly posted on December 27. On or about February 5, 1952, the Union's representative, M. A. Lovay, arranged for a meeting with Respondent's representatives and the meeting occured on February 12. At this meeting, Lovay submitted to Respondent the Union's pro- posed bargaining contract and explained its terms. The Respondent raised no .question at this meeting of the Union's status as bargaining representative, but intimated that its business might be sold. It was agreed that the parties would meet again on February 26, and this meeting occured but no collective bargaining ensued because at this meeting the Respondent informed the Union that it had sold its business to Johnson. There were no further negotiations between the Respondent and the Union. 5 N. L. R. B. v. Conover Motor Co., 192 F. 2d 779 (C. A. 10), enforcing 93 NLRB 867; _93 NLRB 900; 93 NLRB 836. THE BIRDSALL-STOCKDALE MOTOR COMPANY 311 By sales agreement dated February 29, 1952, Johnson acquired Respondent's business and continued , without interruption , the operation of that business.'- The details of the transaction will be related hereinafter. By letter dated February 26, 1952 , Lovay informed Johnson of the Union's : representative status and requested Johnson to continue the negotiations which had been initiated between the Union and the Respondent . By letter dated February 29, Johnson, through its attorney, declined to negotiate with the Union, his position then , and since maintained, being that as the new owner of the- business formerly operated by the Respondent he was under no duty to recognize and bargain with the Union on the basis of its prior certification. 2. The relationship between the Respondent and Johnson 3. The relationship between the business conducted by the Respondent and the business conducted by Johnson -1. The full circumstances of the sale or other transfer of the business and/or physical assets from the Respondent to Johnson The relationship between the Respondent and Johnson is that of seller an& buyer. Johnson had and acquired no interest in Respondent ; Respondent had and acquired no interest In Johnson ; they were and are separate and distinct legal entities. By sales agreement dated February 29, 1952, Johnson acquired certain physical' properties and assets of the Respondent , such as new and used cars and acces- sories ; machinery and shop equipment ; accounts receivable ; work in progress and leases on properties housing the Respondent 's business. There was no- transfer of intangibles , such as good will, trade name, etc., and no assumption of liabilities other, of course, than such as would attach to the buyer by operation of law. The Respondent , at the time the sales agreement was executed, operated as a dealer in Pontiac cars under a direct dealer selling agreement with the Pontiac Motor Division of General Motors Corporation , herein called Pontiac.' This agreement was not assignable or transferable except with the prior written approval of Pontiac . There was no formal assignment of it. It is clear, how- ever, that it was a part of the transaction between Respondent and Johnson that Respondent would relinquish and Johnson would acquire the Pontiac franchise. By documents dated February 28, Respondent advised Pontiac that it was termi- nating its franchise ; that it had sold all the physical assets of its business to Johnson ; and that in consideration of the execution of a new Pontiac selling agreement between Pontiac and Johnson, it was making certain declarations concerning claims and liabilities under its own franchise. On the same date, a direct dealer selling agreement , identical with that previously held by Re- spondent, was executed by Johnson and Pontiac. On or about February 25, the Respondent notified its employees of the sale of its business to Johnson. Johnson took applications from all of Respondent's employees and informed them that all of them would be retained if they were 6 Johnson is a Delaware corporation, organized by Verne Johnson, its general manager, on February 20, 1952, and qualified to do business in the State of Colorado on February 26, 1952. Its stockholders are Verne Johnson and Motors Holding Division of General Motors Corporation. Although the sales agreement between Respondent and Johnson was dated February 29, Johnson actually began the operation of the business it had purchased from Respondent on February 26. ' Previously, the Respondent, in addition to its Pontiac franchise, held a franchise with the Packard Motor Car Company as a dealer in Packard cars. This franchise, dated April 1, 1949, was canceled on August 16, 1950, and was not thereafter renewed or reinstated. 312 DECISIONS OF NATIONAL LABOR RELATIONS BOARD able to perform their work satisfactorily. Actually, there was no break in their employment due to the sale of the business by Respondent to Johnson; they ceased to be carried on the payroll of Respondent on one day and on the fol- lowing day they were carried on the payroll of Johnson. Johnson required that they be bonded but other than this there was no substantial change in the manner and method of their employment. They continued under Johnson to perform the kind and order of duties they performed under Respondent. Re- spondent's general sales manager, Atkinson, became assistant manager to Gen- eral Manager Verne Johnson ; a mechanic was transferred by Johnson from the warehouse operated by Respondent (but not by .Johnson) to Johnson's main shop ; another employee was transferred to Johnson's used car lot. Otherwise, the disposition of Respondent's personnel remained substantially the same under Johnson. Netterfield, Respondent's shop foreman, continued as shop foreman under Johnson. The business operated by Johnson was substantially the same as that oper- ated by Respondent, Johnson continuing the business as a dealer in Pontiac cars. In April, he acquired a franchise from the GMC Truck & Coach Division of General Motors, in addition to his Pontiac franchise, and at sometime there- after hired additional personnel on his sales force. Under the leases that he obtained under his sales agreement with Respondent, he occupied the same premises occupied by Respondent, with certain exceptions. He did not occupy the warehouse used by Respondent or permanently occupy Respondent's body shop ; in June he leased a used car lot not previously used by Respondent ; he eliminated Respondent's storage business and acquired a garage. Any other changes were too inconsequential to require mention. 5. The responsibility of the respective companies for remedying the unfair labor practices found in the Board's Decision and Order The Respondent, a defunct corporation which has disposed of its business in which the bargaining unit lies, obviously no longer has the capacity to comply with the Board's Decision and Order directing it to bargain with the Union. Before the sale of its business to Johnson, the Respondent did comply to the extent of posting the required notices and meeting with the Union in the latter's capacity as bargaining representative. It must be assumed that the compli- ance, though it came late, was all that could be required of it In the brief space between the court's decisions on matters of Jurisdiction which brought the Respondent into compliance, and the sale of its business, but obviously, the two brief meetings between representatives of the Respondent and the Union, in the first of which the Respondent intimated the sale of its business, afforded the Union no real opportunity for the exercise of its representative status. In short, from the date of its certification as bargaining representative on March 23, 1950, to the transfer of Respondent' s business to Johnson on or about Febru- ary 26, 1952, the Union and the employees it represented, because of Respondent's unfair labor practices, were denied the benefits and privileges of bona fide collective bargaining guaranteed them by the Act. The policies of the Act can be effectuated in this case only if the Board's Decision and Order imposes a duty on Johnson, as successor to the Respondent, to continue the negotiations with the Union which were initiated by his predecessor shortly prior to the latter's sale of its business to Johnson. Under the doctrines of the Alexander Milburn Company case (78 NLRB 747),8 Johnson is a successor to the Respond- 8 For an erudite and comprehensive discussion of legal principles underlying this decision, reference is made to the distinguished Intermediate Report Issued by Trial Examiner in the case and incorporated in the Board's decision. MURRAY CORPORATION OF AMERICA 313 ent and by operation of law is bound to cooperate in dissipating its predecessor's unfair labor practices by recognizing and bargaining with the Union. Johnson is a successor to the Respondent within the meaning of the Alexander Milburn Company case, because he continued, without interruption, the business of his predecessor as a franchised Pontiac dealer, on substantially the same premises as his predecessor, and because the Respondent's employees became his employees immediately upon his accession to the business, with no substan- tial change in the nature of their duties, supervision, or the conditions under which they worked. As I understand the Alexander Milburn Company case this is all that is required to constitute Johnson a successor within the meaning of that decision. In its own summation of the case, the Board has stated that it therein "held a bona Fide successor to be responsible for remedying the unfair labor practices of its predecessor, even though there was no showing that the successor was, in any sense, an alter ego or disguised continuance of the pred- ecessor, or that it participated with the predecessor in its violations of the Act." (Autopart Manufacturing Company, 91 NLRB 80, 81).' There is no such showing in the case at bar. The rationale in this line of cases appears to stem largely from the court's decision in N. L. R. B. v. Colten, 105 F. 2d 179, 183 (C. A. 6, 1939), in which the court said, "It is the employing industry that is sought to be regulated and brought within the corrective and remedial provisions of the Act in the interest of industrial peace." I had not thought it clear, until I read the Autopart Manufacturing Company case (cited supra), that knowledge of the successor on acquiring the business of his predecessor of the pendency of unfair labor practice proceedings against the predecessor, was necessarily essential for holding a bona fide successor responsi- ble for remedying the unfair labor practices of his predecessor, but, in any event, Johnson had knowledge before he acquired the Respondent's business of the pendency of unfair labor practice proceedings against the Respondent, and it is immaterial if in his mistaken belief that as new owner of the business he would nowise be bound to assume unfulfilled bargaining obligations of the Respondent, he failed to inform himself fully as to the nature and scope of those obligations 70 Accordingly, it is held that the Respondent and Johnson are jointly and severally responsible for compliance with the terms of the Board's Decision and Order. 9 See also, Charles R. Krim.m Lumber Company, et al., 97 NLRB 1574 ; Indianapolis Wire-Bound Bow Company, 93 NLRB 875; L. B. Hosiery Co., Incorporated, 88 NLRB 1000; Union Products Company, 75 NLRB 591; McCarron Co., 100 NLRB 1537 30 The finding of knowledge is based on the testimony of Frank H Stockdale, an officer of Respondent, that in January preceding the sale of the business to Johnson in February, he told Johnson that "there was a National Labor Relations Board order standing," and Johnson's admission that Stockdale told him that there had been an order requiring Respondent to bargain with the Union. MURRAY CORPORATION OF AMERICA-ECORSE PLANT and INTERNA• TIONAL UNION, UNITED AUTOMOBILE, AIRCRAFT & AGRICULTURAL IMPLEMENT WORKERS OF AMERICA (UAW-CIO) , PETITIONER. Case No. 7-RC-1722. November 14, 1952 Decision and Order Upon a petition duly filed under Section 9 (c) of the National Labor Relations Act, a hearing was held before Emil C. Farkas, hear- 101 NLRB No. 75.