Sunderland's Inc.

118 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Sunderland's Incorporated and International Jewelry Workers Union, Local 30, AFL-CIO. Case 19-CA-5004 November 10, 1971 DECISION AND ORDER BY CHAIRMAN MILLER AND MEMBERS JENKINS AND KENNEDY On June 24, 1971, Trial Examiner Maurice M. Miller issued the attached Decision in this proceed- ing. Thereafter, the General Counsel filed exceptions and a supporting brief. Pursuant to the provisions of Section 3(b) of the National Labor Relations Act, as amended, the National Labor Relations Board has delegated its authority in this proceeding to a three-member panel. The Board has considered the record and the Trial Examiner's Decision in light of the exceptions and brief and has decided to affirm the Trial Examiner's rulings, findings, and conclusions,' and to adopt his recommended Order.2 ORDER Pursuant to Section 10(c) of the National Labor Relations Act, as amended, the National Labor Relations Board adopts as its Order the recommend- ed Order of the Trial Examiner and hereby orders that the complaint be, and it hereby is, dismissed in its entirety. 1 We agree with the Trial Examiner that those cases in which the Board has found that ratification is a gratuitous process which union negotiators impose upon themselves, or in which employers have attempted to rely upon some defect in the ratification process, are not applicable here. The record in this proceeding discloses that during bargaining negotiations Riviera, Respondent's attorney and bargaining agent, sought specifically to determine whether the Union's representatives had the final authority to accept or reject a contract, and insisted that they come, to bargaining armed with such authority. The union negotiators, in turn, took this question back to the union membership but, upon a vote taken among the members, they were given only the authority to take Respondent's best offer and bung it back to the membership for ratification. It is thus clear that, the Union negotiators did not have final authority to accept or reject a contract offer, and, as the Trial Examiner found, ratification was made a precondition of arrival at a binding agreement. Here such ratification did not take place prior to Respondent's withdrawal of assent to proposed contract terms. 2 We do not adopt or pass upon the Trial Examiner's "Postscript," section III, D, of his Decision, as it is unnecessary to the determination of the issues in the present case TRIAL EXAMINER'S DECISION STATEMENT OF THE CASE MAURICE M. MILLER, Trial Examiner: Upon a charge filed October 22, 1970, and duly served, the General Counsel of the National Labor Relations Board caused a Complaint and Notice of Hearing to be issued and served upon Sunderland's Incorporated, designated as Respon- dent in this decision. The Complaint issued January 7, 1971; therein, Respondent was charged with unfair labor practices affecting commerce within the meaning of Section 8(aX5) and (1) of the National Labor Relations Act, as amended. 61 Stat. 136, 73 Stat. 519. Within Respondent's duly filed answer, certain factual statements in General Counsel's Complaint were conceded; Respondent, howev- er, has denied the commission of any unfair labor practice. Pursuant to notice, a hearing was held in Seattle, Washington, on March 16, 1971, before me. The General Counsel and Respondent were represented by counsel. Each party was afforded a full opportunity to be heard, to examine and cross-examine witnesses, and to introduce evidence pertinent to the issues. Since the hearing's close, briefs have been received from General Counsel's repre- sentative and Respondent's counsel. These briefs have been duly considered. FINDINGS OF FACT Upon the entire testimonial record, the documentary evidence received, and my observation of the witnesses I make the following findings of fact: 1. JURISDICTION Respondent raises no question with respect to General Counsel's jurisdictional claim. Upon the Complaint's relevant factual declarations-specifically, those set forth in detail within the second paragraph thereof-which are conceded to be correct, and upon which I rely, I find that Respondent was, throughout the period with which this case is concerned, an employer within the meaning of Section 2(2) of the Act, engaged in commerce and business activities which affect commerce within the meaning of Section 2(6) and (7) of the Act. Further, with due regard to presently applicable jurisdictional standards, I find asser- tion of the Board's jurisdiction in this case warranted and necessary to effectuate the statutory objectives. II. THE LABOR ORGANIZATION INVOLVED International Jewelry Workers Union, Local 30, AFL-CIO, designated Complainant Union within this decision, is, and at material times herein has been, a labor organization within the meaning of Section 2(5) of the Act, as amended, which admits certain of Respondent's employees to membership. III. THE UNFAIR LABOR PRACTICE CHARGED A. Issue This case's central question may be simply stated. Did Seattle counsel Dan Riviera, who had been retained as Respondent's representative in connection with certain collective-bargaining negotiations, reach an October 1, 1970, consensus with Complainant Union herein-while functioning in Respondent's behalf-regarding the terms of a new collective-bargaining contract, thereby rendering Respondent's conceded refusal to sign a contract draft which compassed the terms of their consensus, thereafter, violative of Section 8(a)(5) of the statute? Confronted with General Counsel's contention that Respondent has, indeed, 194 NLRB No. 15 SUNDERLAND'S INC. failed and refused to sign a contract with respect to which its designated collective-bargaining spokesman had orally declared Respondent's concurrence, the firm's counsel proffers several related defenses . He contends : (a) That Respondent's designated representative did not, during or following the collective-bargaining session noted, declare his client's "acceptance" with regard to Complainant Union's contractual proposal; (b) that Complainant Union's spokesmen, since they were chargeable with knowledge that Respondent was then in severe financial straits, lacked any reasonable basis for their professed belief that Respondent's representative had really "accepted" their contractual proposals ; and (c) that, despite a possibility that the conduct of Respondent's designated representative-while functioning as the so- called "adhoc" collective-bargaining spokesman for certain other concerned employers-could be construed as show- ing Respondent's apparent concurrence, that concurrence was withdrawn before Complainant Union's membership had ratified their purported contractual consensus, or taken action relying thereon. B. Facts 1. Background For some years past-never specified for the record-the Complainant Union herein has maintained collective- bargaining relationships with a number of Seattle jewelry firms. Their most recent contract, a master agreement signed by each covered firm with an extended 2-year term, had a September 30, 1970, termination date. The firms privy thereto, some 15, fell into two categories: manufacturing or production shops, and trade repair shops. The former manufacture general lines of jewelry which they merchandise to wholesalers and retail stores; trade repair shops do repair work for various retail jewelry dealers but may also produce some custom made jewelry on special order. Within the Seattle area, there are two major, and three minor, production shops. Respondent herein , together with another firm, Gem East Corporation d/b/a Northwest Jewelers, has throughout the period with which this case is concerned been considered a major production shop. According to Patrick Druxman , Gem East's vice-president, Sunderland's is his firm's principal competitor within the Seattle area and possibly elsewhere . Complainant Union's contractual relationships with both Respondent and Gem East during their most recent 2-year contract terms included special "riders" with provisions specifically drafted to cover matters of special concern in production shops. 2. Contract negotiations begin Sometime during July 1970 reopening notices were sent to those firms with which Complainant Union had a contractual relationship . Thereafter, sometime during the middle of August, Complainant Union's spokesmen met with a group of employers for a preliminary bargaining session. However, no representatives of Respondent or Gem East were there; three other small "one-man" shops were likewise unrepresented . Subsequently, Helen Davison, 119 Complainant Union's secretary-treasurer and business agent, conferred with Ray Sunderland, Respondent's president, and Jerry Gallagher, Respondent's vice presi- dent; they reviewed Complainant Union's August 11 contract proposals. Davison's credible testimony regarding this last conference, standing without contradiction, warrants a determination that Respondent's representatives first requested renewal of their reopened contract without change for a further 1-year term. Then, with particular reference to Complainant Union's new contract proposals, Respondent's spokesmen questioned several provisions. Davison's testimony, however, will within my view support a determination that Sunderland and Gallagher finally said they would "go along" with Gem East, so far as production workers' wage rates were concerned. Complainant Union's next bargaining session convened on August 23; representatives of all the concerned employers, Respondent included, were present. Additional- ly, Dan Riviera, a Seattle attorney, was present solely as the designated collective-bargaining spokesman for Spring Ring Stylists, Inc., one of three small production shops. The record with respect to this bargaining session , however, merits characterization as limited. Sometime during the session, I find, the Complainant Union was effectively given notice by each employer present that , despite their common participation in coordinated bargaining sessions, they proposed to bargain individually looking toward the negotiation of separate contracts . Complainant Union's membership, the record shows, had voted to seek one contract with these various jewelry firms . The evidence received, however, fails to clearly reveal whether they were seeking a renegotiated single master contract which all concerned employers would sign, or 15 separate contracts with matching terms and conditions . Two firms, Spring Ring Stylists, Inc., and Gem East, had previously notified Complainant Union's secretary-treasurer, before this August 23 bargaining session , that they would not participate as members of any multiemployer bargaining group. The Union representatives were told categorically that the employers present would not bargain for a single master contract; so far as the record shows, Complainant Union did not thereafter seek any modification or retraction with respect to this declared employer position. With respect to substantive contract questions, discussion during these August 23 talks seems to have ranged widely. Many of those employer representatives who were present, the record shows, verbally proffered divergent views with respect to particular contract proposals. With respect to some few matters, however, definitive consensus was reached. Some counterproposals proffered by various employers were subsequently referred to Complainant Union's membership, which rejected them. Within a September 14 letter, dispatched shortly following a September 10 bargaining session which he did not attend, counsel Riviera notified Complainant Union that his law firm, which already represented Spring Ring, would likewise thereafter represent Respondent with reference to these pending collective-bargaining negotia- tions. The Union was, likewise, reminded that Respondent was not a member of any employer group and would be bargaining individually. Riviera then presented Complain- 120 DECISIONS OF NATIONAL LABOR RELATIONS BOARD ant Union with a few counterproposals , primarily derived from their prior contract talks. During subsequent bargain- ing sessions, which will be discussed further hereinafter, Riviera functioned in representative capacities for both of his jewelry firm clients , Spring Ring and Respondent herein. On September 23, Complainant Union 's spokesmen met with employer representatives for another bargaining session. The record-with respect to developments during their discussion-presents no significant conflicts . Secretar- y Treasurer Davison testified, with Riviera's general concurrence, that substantial consensus was reached with regard to certain proposed changes in basic wage rates; the witnesses did differ, however, with respect to the participa- tion of Sunderland's therein. While a witness Davison professedly could not recall any significant statement, with respect to wage rate matters properly chargeable to Riviera during this bargaining session, save for a promise which he made that he would submit a rewritten "cost of living" provision which would protect all parties. When questioned then regarding Sunderland's reaction during these basic wage rate discussions , Complainant Union's secretary- treasurer declared her belief that Respondent's president merely "sat there with his head in his hands " without making "too many" remarks. Riviera, however, while conceding generally that all participating concerned employers, with Respondent the sole exception, were prepared to "go along" with Complainant Union's proposed wage increases conditioned upon their realization of satisfactory adjustments regarding other matters in dispute, recalled rather vaguely that Respondent 's presi- dent had shaken his head negatively while the basic wage rate consensus was developing, and had thereafter declared "I can't do it" while throwing up his hands. The testimonial conflict thus presented, between Davison and Respondent's representative, will be discussed subsequently , within this decision. With respect to further bargaining, during the course of this September 23 session, the present record provides little information. Davison's testimony which I credit, would warrant a determination, merely, that when the session concluded there were only three "substantial" questions remaining unsettled. These were questions concerning the proposed contract's geographic coverage , the precise language of the proposed "cost of living" provision, and the length of the waiting period which would be required as a precondition for pension fund eligibility. 3. - Final bargaining sessions With matters in this posture , the services of a Federal mediator were requested. On September 30, negotiations continued at the Federal Mediation and Conciliation Service's Seattle headquarters. When the parties present were requested to introduce themselves, Riviera declared, the record shows, that he was merely representing Spring Ring and Respondent. Nevertheless, during the relevant discussions which followed, Respondent's counsel seems to have played a principal role. Before the session closed, for example, he questioned the authority of Complainant Union's spokesmen to negotiate a definitive settlement and declared that future bargaining would be futile unless Union representatives could demonstrate their power to "accept" whatever contractual consensus the parties might reach. Complainant's spokesmen were requested to secure such powers from their Union's membership. That evening, Complainant Union's membership met in special session. A secret ballot was conducted ; thereby the body's negotiations committee was granted "the power to accept the best offer possible from management,... and bring this back to the members for final ratification." According to Davison, this affirmative membership vote signified that-should the negotiations committee return with employer proposals for wage increases sufficient to provide a specified minimum hourly rate, plus improved health, welfare and pension provisions-final ratification would be forthcoming. The committee was, however, further granted the power to set a strike date, should it deem such action necessary. When the parties met for their October 1 session in the Federal Mediation and Conciliation Service headquarters, Respondent's counsel, presumably by common consent, became the principal spokesman for those employers present. One, Don McCune, was unavoidably absent. The cross-table discussion was, the record shows, somewhat disconnected, disorganized, and confusing; pursuant to one company participant's suggestion that their negotiations would have a better prospect of success with a single, knowledgeable person designated to present the views of the concerned employers present, Riviera was conceded that function. Complainant Union's spokesmen, the record shows, first notified the employers present that, should they reach a contractual consensus, ratification of that consensus by the Union's membership would still be required; the employers were reassured, however, that the membership's position, with respect to contract terms, had been well defined, and that ratification could be considered certain for any contractual agreements which the Negotiations Committee would consent to present for membership consideration. The company representatives were, nevertheless, told further that Complainant Union's membership had author- ized strike action, and that there would be a strike call by noon of the following day (October 2, Friday) should no agreement be reached. Complainant Union's spokesman then presented some slightly revised contract proposals. Those with respect to which substantial consensus had previously been reached were quickly reviewed. Still others, considered "up in the air" and open for further discussion, were canvassed generally. Riviera, pursuant to his promise, presented a revised cost-of-living provision. The concerned employers finally decided to caucus, separately with regard to certain questions not yet resolved, while Complainant Union's representatives waited for their decision. No further joint sessions were held. The Federal mediator and Riviera shuttled back and forth, several times, between the employer's caucus and Complainant Union's represent- atives, conferring with each and carrying counterproposals. For the record, both Patrick Druxman, Gem East's vice president, and Riviera testified with regard to discussions within the jewelry firms' caucus. At this stage, within, my view, no detailed factual determinations regarding the SUNDERLAND'S INC. 121 general course of those discussions would seem required. Should their consideration hereinafter be considered necessary to facilitate a proper disposition of some contentions presented in Respondent's behalf, these caucus deliberations will be reviewed within a subsequent section of this decision. Following some sustained discussion within the employer's caucus, Riviera concluded, the record shows, that a substantial consensus, with respect to Complainant Union's contract demands, had been reached. Since it was then lunch time, the attorney advised the employers, I find, that he would come back after lunch and communicate with Complainant Union's spokesmen, regarding their readiness to concur with the Union's contract proposals. According to Druxman, whose testimo- ny in this respect I credit, the several employers present were told that it would not be necessary for them to return. When the caucus thereupon disbanded, Riviera fortui- tously encountered Complainant Union's representatives in the Court House hallway, leaving for lunch. Taking advantage of this chance encounter, he communicated his message. The present record with respect to that communi- cation provides this case's central point of testimonial conflict. With respect thereto, General Counsel's position rests upon Davison's recollection. She testified as follows: We were then to break for lunch and Dan Riviera said, "Now, let's settle now." And Dan Riviera came back and said that they had agreed and the union had won. Complainant Union's secretary treasurer declared, categor- ically, that Riviera did not specifically during this hallway conversation mention Respondent, or any other concerned employer. When queried further in this connection, during cross-examination she testified as follows: Q. Do you have any recollection of Mr. Riviera or anybody else suggesting to you on October 1 around noon when you received word from Mr. Riviera that the employers had accepted the union proposal? Do you recall Mr. Riviera saying anything about Sunderland's not being part of that group? A. No. Q. Do you recall anything earlier from Mr. Riviera or anyone else suggesting that Sunderland's was not part of this dialogue between the employers and the union? A. No. Questioned, then, regarding the factual basis for her subjective conclusion that Respondent had likewise "agreed" with respect to their contract, Davison testified that she had so concluded because of her "belief" that, had Ray Sunderland not concurred with the rest of the concerned employers, their contract would never have been settled, since the other firms would never have agreed to sign a contract based on Complainant Union's proposal while "someone else" remained uncommitted. According to Davison "it was just assumed" afterwards that she would prepare 15 identical contract drafts, embodying the contractual consensus reached, and that Riviera would "rewrite" a few provisions to provide her with language guidelines. Riviera, the Respondent's sole witness with regard to this significant hallway conversation, recalled its substance in somewhat less positive terms. His composite testimony, with respect thereto, reads as follows: We got close to about 12:00 o'clock, and by this time . it looked like if they couldn't get together there was going to be a strike . . . I don't recall now what the last thing was that the union people said to me, or what issue it was, but in any event I went back into the other room and asked those who were there - what their view was on it. Sunderland said, "No" they couldn't, shook his head and said no. The others pretty much were for it, whatever the issue was. By this time, the union people were out in the hall going to the elevator. I came out into the hall and said, "OK you've got to take it to the group and get it settled. You've got this fact to be settled." Whatever it was ... [Oh], before we left the courthouse, there was a discussion, a few comments, we'll be back at 1:30. I don't recall saying it myself but I recall hearing it. "We'll be back at 1:30," meaning Sunderland's people .. . Riviera did concede that Respondent had not been specifically mentioned during this hallway conversation. Then, when asked again whether his reference to a planned 1:30 return had been made during the hallway conversa- tion, Respondent's spokesman first said he was "quite sure" but then said he was not positive: I have a recollection now that I was coming back at 1:30. Whether I said it or it was said to me, and I just generally understood it was [,] I can't say now but I remember that. I don't recall saying or indicating now that I was to tell the union, to tell the union something at 1:30. That I do not recall . . . I don't recall telling anyone that I would be back at 1:30. I knew I was supposed to be back at 1:30 and I may have said it .. . I don't recall saying it myself. I recall somebody saying it, that I'd be back at 1:30... what I'm trying to say, I understood in my mind that the two Sunderland's people and I^would be back at 1:30 but I don't recall myself saying, "I'm going to be back at 1:30." Confronted with Davison's testimony that he had used the term "agreed" during this hallway conversation, Riviera conceded a failure of recollection. His testimony in this connection, however, reads as follows: I can't tell you the precise words I said, but I know that when I was in the hall, the context of the conversation we had that day, I know that I didn't say everyone agreed except Sunderland. I didn't say that. I said, OK, it's a deal, or something to that effect. [The] majority group, other than Sunderland, had agreed on it, but I know I didn't say that. Respondent's representative declared it was his "understanding" that every participant in the employer's caucus had agreed regarding the Union's proposals except Respondent herein; further, the record reflects his pro- fessed "belief" that Complainant Union's representatives were aware Respondent should not be considered privy to the consensus reached. In this connection, however, Riviera was finally asked why his declaration of contract "acceptance" had been generalized, without any specific reference to the fact that Spring Ring, inter aria, had accepted, but that Respondent had withheld concurrence. In reply, the attorney declared that: 122 DECISIONS OF NATIONAL LABOR RELATIONS BOARD If I could tell you how negotiations go, people going in from one room to another, if I could go back and do everything all over again, maybe I should have put it in writing, but the fact of the matter is that we were dealing as human beings with one another, and I thought it became perfectly plain that Sunderland's were not going to go along with the package at all. It's easy to criticize now and say, "Well, you should have made a speech." On this note, Riviera's testimony, particularly with regard to this October 1 noon hour hallway conversation, was concluded. With matters in this posture, I conclude and find that Respondent's collective-bargaining representative during the hallway conversation now under consideration did, indeed, tell Complainant Union's representatives, without specifying any exceptions, that their contractual proposals had won "employer" concurrence; likewise, I find that, when he did so, he did not declare Respondent a nonparticipant. Further, with due regard for Davison's positive testimony on the point and Riviera's contrasting lack of certainty, I am satisfied that Respondent's collective-bargaining representative made no comment during the conversation in question regarding his prospec- tive 1:30 return, following a luncheon break, for any purpose whatsoever. Complainant Union's committee members, I find, thereupon went to lunch and then "went back to work" presumably at Union headquarters. 4. Subsequent developments Sometime between 2:00 and 3:00 o'clock that afternoon, Riviera telephoned Complainant Union's secretary-treasur- er. Mrs. Davison was advised that due to Ray Sunderland's precarious financial status the Respondent "could not afford" to "go along" with the contractual consensus which had just been reached. The record shows that, since April 1970, preceding these contract negotiations, the Respon- dent had been involved in chapter 11 reorganization proceedings, under the Federal bankruptcy law. Complain- ant Union's secretary-treasurer was, the record shows, fully cognizant of this situation; she had, before October 1, attended "all but one" of several court-sponsored hearings or meetings held in connection with these reorganization proceedings. She had, further, held some "off the cuff" discussions with Ray Sunderland regarding various ways in which Respondent's workers might help relieve a continu- ing drain on the firm's cash resources; none of these discussions had, however, borne fruit. With matters in this posture, I am satisfied that when Riviera referred to Respondent's financial straits during the telephone conver- sation with which we are now concerned Mrs. Davison understood that he was, particularly, referring to Sunder- land's chapter 11 reorganization. The record reflects a testimonial conflict regarding Davison's reply. According to Respondent's collective-bargaining representative, whose recollection had to be refreshed, Mrs. Davison conceded her understanding regarding the situation and declared that Complainant Union would not "do anything" such as calling a strike until sometime after Respondent's next bankruptcy court hearing. Davison, however testified that Riviera was merely told she could do nothing, at the moment, but that she would consult with Complainant Union's officers to see what could be done with respect to "holding off" possible strike action against the firm. With due regard for the record considered in totality and, particularly, in view of Riviera's lack of certainty I credit Davison's proffered recollection detailing her response. During their conversation, I find, Riviera did refer to his professed "expectation" that they were to meet at the Court House after lunch to conclude negotiations with regard to Respondent's contract particularly; Davison, however, replied that the Union negotiators considered their bargaining concluded. Riviera then concluded their telephone conversation, I find, with a promise that he would "get in touch" with Complainant Union's secretary-treasurer. Later that day, so Davison credibly testified before her recollection was purportedly refreshed, he visited Complainant Union's office and provided her with a reworked and redrafted copy of Complainant Union's previously submitted contract proposals, proffered for her guidance in preparing the requisite language for final contract drafts. That evening, pursuant to her telephonic committment noted, Complainant Union's secretary-treasurer did confer with her organization's officers. She told them that she did not think it would be "smart" to strike Respondent's shop then and there because of Sunderland's financial problems; that this would help neither him nor the workers concerned. Davison requested the Union officers, she testified, to consider "some kind of relief" for the respondent firm, particularly a decision to refrain from striking until some time after October 23rd, when the firm's next bankruptcy court appearance was scheduled. According to Complain- ant Union's secretary-treasurer, this forbearance would be calculated to help Sunderland through his "financial bind" so that he could "subsequently" sign the contract. The Union officers, so Davison testified concurred with this suggestion. Meanwhile, during the following week, Complainant Union's secretary-treasurer did prepare a number of contract drafts, with identical language; these were subsequently sent to every firm still in business which had participated in the recently concluded collective-bargaining negotiations. They were, later, returned with signatures by each represented firm, except Respondent herein. One small shop operator, Don McCune, likewise failed to sign Complainant Union's proffered contract; sometime during October's first week, so Davison credibly recalled, he had released his employees and become a self-employed Union member. The parties' October 1 contractual consensus had previously been ratified during a meeting held the night of the day it was reached by Complainant Union's member- ship; Davison testified, credibly, that Respondent's em- ployees, some of whom had attended the ratification meeting, had voted upon the ratification question. On October 22, Complainant Union's charge which initiated the present proceeding was filed. Thereafter, on November 20, the Union members in Respondent's hire finally did strike the firm, purportedly because of their unwillingness to work in a nonunion shop. According to Complainant Union's secretary-treasurer, whose testimony SUNDERLAND'S INC. 123 in this respect has not been disputed , Respondent's management "opened the following day as a non-union shop" hiring nonunion workmen. C. Conclusions With matters in this posture, we confront the first of several questions which the present record presents: Did Complainant Union and Respondent herein reach "agreement" regarding a new collective-bargaining con- tract, following the conclusion of their October 1 negotiat- ing session? General Counsel would have this Board find that, when Riviera told Complainant Union's negotiators, either in words or substance, "O.K., it's a deal" during their noontime hallway conversation, such communication constituted a binding "acceptance" with respect to Complainant Union's contract proposals, on behalf of each and every concerned employer, and particularly on behalf of his two clients, Spring Ring Stylists, Inc., and Respondent herein. Respondent, however, presses a contention that Riviera's generalized communication was not intended to convey its concurrence with respect to whatever contractual consensus some other concerned employers might have reached ; that Complainant Union's representatives either knew or had reason to know that Respondent's management had not really "accepted" their contract proposals ; and, therefore, that Complainant Union was never misled regarding Respondent's position, despite counsel's failure to declare the firm's nonconcur- rence specifically. Respondent's line of defense with respect to this particular facet of General Counsel's case cannot stand. With respect thereto, first, some matters may be taken as data. Clearly, throughout the period with which this case is concerned, Riviera concededly functioned as Respondent's designated representative "with reference to pending negotiations" 'looking toward a new collective-bargaining contract. In that capacity, he necessarily possessed "actual" power rather than mere "apparent authority" to negotiate a contractual consensus in Respondent's particular behalf and to declare Respondent's concurrence with respect thereto. The brief filed in Respondent's behalf, so far as I can tell, raises no challenge with respect to these propositions ; counsel presumably seeks a determination, rather, that Riviera's crucial communication , though proffered within the scope of his authority, was never intended to commit Respondent, and could not reasonably have been so construed. While a witness, Riviera persistent- ly declared that his October 1 statement had not been intended to bind Respondent ; further, he declared his "belief" that, throughout, Complainant Union's negotiators really understood that Respondent had not agreed with respect to various matters, regarding which he had communicated the concurrence of other concerned em- ployers. Riviera's professed belief in this respect, so counsel would have me find, should be codered warranted because: 1. Ray Sunderland had made manifest several times during various bilateral negotiating sessions the fact that he could not "go along" with some Union contract proposals, with respect to which his fellow employers seemed disposed to yield. 2. The so-called "jurisdictional" question which Sunderland's, alone, had raised regarding their prospec- tive contract's geographic coverage had not yet been settled. 3. Sunderland's known involvement with respect to chapter 11 corporate reorganization proceedings, under Federal bankruptcy law, raised a significant question, with respect to which Complainant Union was knowl- edgeable, regarding the firm's prospective capacity to meet various contractual commitments which other, more viable, firms could presumably satisfy. 4. Riviera and Respondent's management team, together with Complainant Union's committee mem- bers, had mutually understood that they were to resume negotiations, with particular reference to Respondent's situation, following their luncheon break. These considerations, so counsel presently contends , should reasonably have persuaded Complainant Union's repre- sentatives that Riviera's generalized October 1 announce- ment regarding a contractual deal was never intended to commit Respondent herein; counsel would have this Board find, therefore, that so far as Respondent was concerned Riviera's message did not constitute the binding acceptance which General Counsel now claims. First: I note that the record reflects testimonial conflict with regard to Sunderland's conduct during collective- bargaining sessions ; Mrs. Davison's testimony, which Vice President Druxman of Gem East substantially. corroborat- ed, would warrant a determination that Respondent's president, though he did reveal some concern and distress when confronted with various monetary contract propos- als, did not clearly declare himself determined to reject them. Such testimony, within my view, merits credence. Further, were I to conclude, nevertheless, consistently with Respondent's contention that Sunderland had made his reluctance to concur with Complainant Union's proposals perfectly clear, determination would still be warranted, within my view, that Complainant Union's negotiators were entitled to rely on Riviera's subsequent October 1 declaration, proffered without qualification, that a general contractual consensus had been reached. Positions strongly held while collective-bargaining negotiations are in prog- ress nevertheless are frequently yielded when circumstances dictate some immediate necessity for consensus. More particularly, such positions may be yielded , with relatively minor misgivings, when some prospect of strike or lockout has become manifest. While a witness, Riviera conceded that this sometimes happened. Such pressures toward agreement were clearly present herein. Thus, when Respondent's spokesman communicated the generalized message that a contractual deal had been reached , without simultaneously declaring Sunderland's nonconcurrence, Complainant Union's negotiators were, within my view, entitled to presume that Respondent's previously expressed qualms with respect thereto had been relinquished or laid to rest. Second: Sunderland's position regarding his prospective contract's geographic coverage never seems to have been considered as raising a serious question likely to prevent or 124 DECISIONS OF NATIONAL LABOR RELATIONS BOARD delay consensus. The present record gives no indication that it was ever discussed, comprehensively, during the negotiations. And Riviera, while a witness, declared his prior and present conviction that whatever difference there may have been between the parties with regard to this matter could have been settled quickly. With matters in this posture, I find, Complainant Union's negotiators were once more privileged to presume that when Riviera, while making his October 1 noontime announcement, failed to designate this question as not yet settled his omission signified Respondent's ultimate determination that the question was not sufficiently significant to prevent or delay agreement. Third: Though Complainant Union's secretary- treasurer may have been knowledgeable with respect to Respondent's straitened financial condition, nothing within the present record will support a determination that she had reason to believe Respondent would not or could not, because of its financial situation, negotiate a collective-bargaining con- tract. Within his brief, General Counsel notes that: The employers, as evidenced by their subsequent insistence to the Union that Sunderland be required to sign the same agreement, and the Union all had the impression that the Respondent was negotiating in the same manner as the others in attendance. And the present record, not previously cited in this connection, will, in my view, fully support General Counsel's factual contention. Thus, Respondent's known involvement with respect to chapter 11 corporate reorgani- zation proceedings cannot be considered, per se, sufficient to have put Complainant Union's spokesmen on notice that Respondent's participation in some shared contractual consensus would be less than likely. Fourth: Respondent's contention that Riviera, Sunder- land, Gallagher, and Complainant Union's committee members shared some mutual understanding that negotia- tions, with particular reference to Respondent's situation, would continue following their October 1 luncheon break simply lacks record support. With matters in this posture, then, I conclude and find that Riviera's noon hour declaration that a contractual deal had been reached represented a consensual acceptance compassing Complainant Union's then pending contract proposals, with respect to which Respondent was privy. Nevertheless, despite this conclusion, I find merit in Respondent's second principal contention, that the firm's so-called "apparent agreement" had been withdrawn before Complainant Union's membership was called on to ratify their presumed contractual consensus. Substantially, the present record shows that Respon- dent's designated representative, functioning under pres- sure within the context of a somewhat volatile, confused situation, had effectively committed his client to contractu- al provisions with respect to which Respondent's manage- ment team had really noted serious reservations. When apprised of Respondent's reluctance to proceed within a comparatively short time, Riviera notified Complainant Union's secretary-treasurer that, whatever construction Complainant Union's negotiators may have given his previous noon hour declaration, so far as Respondent was concerned the firm could not go along with contractual commitments matching those which the other firms privy to the recently concluded negotiations had reached. This telephonic notification within my view consituted an effective withdrawal of Respondent's previously communi- cated consent to be bound. As Respondent's counsel in his brief notes: The participants may have different recollections as to the explanation given by Mr. Riviera for Sunderland's position, but there can be no question that the Union understood by 2 p.m. on October 1, 1970, prior to membership ratification of the contract, that Sunder- land's was not a part of the agreement. General Counsel's representative contends that this at- tempted withdrawal should be considered untimely. He suggests in his brief that: When the Respondent communicated acceptance to the Union, abinding agreement was reached . Clearly, in this instance, ratification by the membership was a pure formality. The membership had given its bargaining committee complete authority to conclude a binding agreement with the employers subject only to the formality of ratification. Despite this contention's superficial plausibility, I cannot concur. True, when Respondent's collective-bargaining representative communicated his client's presumed accept- ance to Complainant Union's negotiators, one necessary step looking toward a final and binding contractual settlement had, so I find, been taken. However, with due regard for the record considered in totality, determination cannot be considered warranted, within my view, that promised ratification by the Complainant Union's mem- bership would be a mere formality. The parties were on notice that a contractual consensus presented for consider- ation by Complainant Union's Negotiations Committee would, most likely, be ratified; Secretary-Treasurer Davi- son, while a witness, conceded, however, that the consensus could have been rejected. We are therefore confronted with a prompt notification, directed to Complainant Union by Respondent's designat- ed collective-bargaining representative, that so far as Sunderland's was concerned no contractual consensus subject to ratification had yet been reached. Complainant Union's membership had not yet considered the matter; Complainant Union's leadership, certainly, had taken,no action predicated on Respondent's presumptive contractual commitments. With matters in this posture, I conclude and find, Respondent's management cannot be considered estopped from withdrawing whatever signal of contractual acceptance Riviera may previously have given. Within his brief, General Counsel cites for its presump- tive relevance with respect to the present situation the settled decisional doctrine that once consensus has been reached with union negotiators, binding enforceable commitments result, so that concerned employers may not rely upon some claimed failure or defect in union ratification processes to excuse their failure to sign proffered contract drafts. General, Asbestos & Rubber Division, Raybestos-Manhattan, Inc., 183 NLRB No. 27; Houchens Market of Elizabethtown, Inc., 155 NLRB 729; cf. M & M Oldsmobile, Inc., 156 NLRB 905; North Country SUNDERLAND'S INC. Motors, Ltd, 146 NLRB 671. These references, however, miss the mark. This Board, to be sure, has declared that ratification will not be considered a condition precedent to the conclusion of an agreement, but rather a gratuitous condition which union negotiators may have imposed upon themselves. Houchens Market, supra. We are not, however, confronted herein with a respondent employer contending that some failure or defect in Complainant Union's ratification process vitiates or cancels its statutory obligation to sign a proffered contract compassing a consensus previously reached. Rather, Respondent contends that nothing remained, so far as Respondent was concerned, which Union members- could ratify, since Riviera gave Davison telephonic notice regarding his client's position before word regarding its presumed participation in the general contractual consensus had been communicated to Com- plainant Union's membership. Significantly, perhaps, Davison took no contrary posi- tion; she did not protest Riviera's declaration, nor did she presume to declare it futile. Rather, Complainant Union's secretary-treasurer committed herself to seek a postpone- ment of possible strike action directed against Respon- dent's shop, looking toward the chance that Ray Sunder- land might subsequently sign a proffered contract draft. With matters in this posture, Respondent's contention that its putative acceptance had been withdrawn before Complainant Union's ratification deserves Board concur- rence. D. Postscript Further and finally, note should be taken, in my view, that a Board Order finding Respondent guilty of some Section 8(a)(5) violation and directing Respondent's management to sign Complainant Union's proffered contract might well finally prove nothing more than an exercise in futility. Reference has been made to Respondent's present involvement in chapter 11 reorganization proceedings looking toward a so-called "arrangement" under Federal bankruptcy law. In connection with such proceedings, the governing statute (11 USCA §713) provides, inter alia, that: Upon the filing of a petition, the Court may ... (1) permit the rejection of executory contracts of the debtor, upon notice to the parties to such contracts and to such other parties in interest as the court may designate... . See, further, in this connection, 11 USCA §753, and §778(B). Collective-bargaining agreements have been held executory contracts within the meaning of this statutory provision, subject to rejection by referees in bankruptcy, upon proper notice, where the referee finds that such a contract's continued effectuation would be detrimental to the debtor's estate. In re Klaber Bros., Inc., 173 F.Supp. 83 (D.C.N.Y. 1959) 44 LRRM 2176; In re Overseas National Airways, Inc., 238 F.Supp. 359, 360, 361-362 (D.C.N.Y. 1965); Compare Carpenters Local Union, No. 2746, United Brotherhood of Carpenters and Joiners of America, AFL-CIO v. Turney Wood Products, Inc., et al., 289 F.Supp. 143 (D.C.W.D. Ark. 1968), dealing with the same 125 question in connection with a full bankruptcy proceeding, and Durand v. N.L.R.B.; In re Turney Wood Products, Inc., 70 LRRM 2651 (D.C.W.D. Ark. 1969) disposing of this Board's claimed interest therein. Should the Board, therefore, see fit to direct that Respondent sign Complainant Union's proffered contract now, such a directive could, conceivably, be nullified shortly thereafter within appropriate chapter 11 reorganiza- tion proceedings under 11 U.S.C.A. §713 and related statutory provisions. The Board's statutory mandate could hardly be considered responsibly effectuated by affirmative relief calculated merely to vindicate "abstract principles of labor-management relations, collective bargaining and Board jurisdiction" without promoting a significant, viable result. See Durand v. N.L.RB., supra, at p. 2654. All things considered, exercises of governmental power susceptible of being rendered nugatory should, in my view, be eschewed. CONCLUSIONS OF LAW In the light of these findings of fact, and upon the entire record in this case, I make the following conclusions of law: 1. Sunderland's Incorporated is an employer within the meaning of Section 2(2) of the Act engaged in commerce and business activities which affect commerce within the meaning of Section 2(6) and (7) of the Act, as amended. 2. International Jewelry Workers Union, Local 30, AFL-CIO, is a labor organization within the meaning of Section 2(5) of the-Act, as amended, which admits certain of Respondent's employees to membership. 3. All of Respondent's production employees in its jewelry manufacturing shop in Seattle, Washington, excluding clerical employees, professional employees, guards, and supervisors as defined in the Act, constitute a unit appropriate for the purpose of collective bargaining within the meaning of Section 9(b) of the Act, as amended. 4. Before October 1, 1970, Complainant Union was designated or selected by a majority of Respondent's employees, within the unit described above, as their representative for collective-bargaining purposes. By virtue of Section 9(a) of the Act, Complainant Union was then entitled to recognition as the exclusive collective-bargaining representative of Respondent's employees within the unit described, with respect to their rates of pay, wages, hours of work, and other terms and conditions of their employment. 5. Respondent has not refused to bargain collectively with Complainant Union herein, within the meaning of Section 8(a)(5) of the Act, as amended, by its failure or refusal, on or after October 1, 1970, to execute a written agreement with Complainant Union embodying provisions relative to wages, hours, and other terms and conditions of employment, with respect to which a prior contractual consensus had purportedly been reached. Upon the foregoing findings of fact, conclusions of law, and the entire record, and pursuant to Section 10(c) of the National Labor Relations Act, I hereby issue the following recommended: ORDER The complaint is dismissed in its entirety.