GRACE CO ET AL v. CALIFORNIA EMPLOYMENT COMMISSION ET AL

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District Court of Appeal, First District, Division 2, California.

W. R. GRACE & CO. ET AL. v. CALIFORNIA EMPLOYMENT COMMISSION ET AL.

Civ. 12110.

Decided: August 13, 1942

Brobeck, Phleger & Harrison, of San Francisco, for petitioners. Earl Warren, Atty. Gen., John J. Dailey, Deputy Atty. Gen., Maurice P. McCaffrey and Glenn V. Walls, both of Sacramento, and Gladstein, Grossman, Margolis & Sawyer, of San Francisco, for respondents.

Petitioners seek to review by proceedings in mandamus an order, or award, of the respondent commission directing payments of benefits for unemployment.

Petitioners, employer–contributors under the Unemployment Insurance Act (Stats. 1935, p. 1226, Deering's Gen.Laws Supp. 1939, Act No. 8780d), are engaged in unloading and discharging vessels at ports on the San Francisco Bay. They employ longshoremen, members of the International Longshoremen's and Warehousemen's Union, to perform this work and they belong to the Waterfront Employers' Association of San Francisco which represents the employers in their labor relations with the longshoremen. Petitioners are also members of the Dock Checkers Employers' Association of San Francisco which represents the employers in their labor relations with the checkers, who are employed to keep a clerical record of the cargo. On June 14, 1939, the checkers' local union called a strike against the American–Hawaiian Steamship Company, one of the petitioners herein. On June 17, 1939, the Dock Checkers Employers' Association severed relations with the checkers' local union and its members refused to employ any checkers until termination of the strike against the American–Hawaiian Steamship Company. The strike was terminated on June 27, 1939. During the ten–day period between June 17 and June 27, 1939, the longshoremen refused to pass the picket lines of the checkers' union, and refused to work upon any job in the absence of checkers, except where it had not been customary to use checkers. Subsequent to the strike the longshoremen claimed unemployment benefits for the period during which they had not worked; they contended that an agreement between the longshoremen's union and the Waterfront Employers' Association required the use of checkers and that they had stopped work to enforce this right. Petitioners, on the other hand, claimed that the longshoremen stopped work to aid the checkers in their dispute with the employers. Respondent, California Employment Commission, found in accord with the contention of the longshoremen and concluded that section 56(a) of the Unemployment Insurance Act did not apply; the commission, one member dissenting, rendered a decision awarding the longshoremen unemployment benefits. Under this decision respondent commission has paid benefits to the claimants and threatens to continue to make further payments, all of which, the petitioners allege, has been charged or will be charged to the account maintained by the Waterfront Employers' Association and to the accounts maintained by the individual petitioners as required by the Unemployment Insurance Act; and that this will damage the petitioners by decreasing their reserve and thereby increasing the contribution rate required to be paid by them. Petitioners therefore apply for a writ of mandate compelling respondent commission to vacate its decision and to correct its records by removing therefrom all charges made against petitioners' accounts by reason of the payment of such benefits.

Petitioners contend that if the respondent commission had found that the longshoremen had left their work to aid the checkers it would have been forced to conclude that the longshoremen made the dispute their own and hence were disqualified from receiving unemployment benefits under section 56(a) of the act, citing Bodinson Mfg. Co. v. California E. Comm., 17 Cal.2d 321, 109 P.2d 935. However, accepting the commission's finding that the longshoremen left work to enforce their own agreement the petitioners contend that the unemployment was the result of a trade dispute within the meaning of section 56(a), and the longshoremen are thereby disqualified from receiving benefits.

Petitioners further argue that mandate is the proper remedy to compel respondent to rectify its decision and that petitioners are the proper parties to obtain that remedy, citing Bodinson Mfg. Co. v. California E. Comm., supra.

The longshoremen, as the real parties in interest, have filed points and authorities in opposition to the issuance of the alternative writ of mandate, and have raised special grounds upon which they contend that the alternative writ should not be granted because: (1) the petitioners have failed to establish the necessity for a speedy determination of the issue and hence this court should not accept jurisdiction prior to an application having been made to the superior court; (2) petitioners have failed to exhaust their administrative remedies and have a plain, speedy and adequate remedy at law which they have pursued by actions filed in the superior court under section 45.10 of the act; and (3) the proceeding is barred by the statute of limitations. Some of these arguments are repeated in briefs filed after the alternative writ was issued. All the respondents seek to sustain the action of the commission not so much upon the grounds upon which the commission based its action as upon the grounds that the longshoremen were casual employees working from day to day, and that they did not leave their work when they refused employment.

The ground last mentioned is fully covered in American–Hawaiian, etc., Co. v. California E. Comm., Cal.App., 128 P.2d 627, this day decided, and it would serve no purpose to repeat what was said in that case. The ground upon which the commission based its action is equally untenable. The majority of the commission found that the employees did not leave their work because of a trade dispute, but because the existing contract between the employers and the employees called for a continuation of the “present practices” and conditions of employment, that these “present practices” required the presence of checkers in the places where longshoremen were employed, and that the respondents had therefore merely refused to work because the employers had breached these terms of the contract. It is too manifest to require elaboration that a controversy over working conditions under the terms of an employer–employee contract is a “trade dispute” and the ground upon which the commission based its action cannot be sustained. It may be added that the parties themselves deemed this to be a trade dispute, that it was submitted to arbitration under the terms of the contract, and that the arbitrator ruled adversely to the longshoremen's contention.

The special pleas of the individual respondents relating to procedure are not sound. The question whether this court should assume jurisdiction to hear and determine this proceeding instead of relegating the petitioners to the superior court was determined upon the issuance of the alternative writ. The question whether the petitioners have exhausted their administrative remedies is answered in the American–Hawaiian case and does not require further discussion. The plea of the statute of limitations rests upon the provisions of section 45.10 authorizing a suit to recover contributions paid under protest. No evidence was offered in support of this special plea, but the parties have stipulated that actions pending in the superior court involve contributions assessed to the petitioners in part because of payments inadvertently made prior to the commission's decision. We find nothing in the record of the proceedings before the commission indicating that any of the contributions here involved were paid under protest, or that they are the subject of other proceedings pending. The proceedings here were instituted to seek a legal determination of the single question whether the employees were covered by section 56 of the act. It is alleged and not denied that a large number of the employees have filed claims for benefits under the act and that their claims have been allowed but that some have not been paid. The decision of the commission was dated April 3, 1940, but not released until May, 1941. A request for a rehearing was denied July 19, 1941, and these proceedings were commenced in February, 1942. It is conceded that there is no statute of limitations which directly applies here. It is reasoned that the court should apply its own limitation by analogy to the time fixed for suits to recover overpayments. This is in effect an argument that petitioners are barred by laches. But the essential elements of laches are not present. “It is not the lapse of time so much as it is the consequences of the delay which goes to make up the defense of laches. Unless prejudice results from the delay the defense is not established, but if prejudice has resulted, the one whose prompt action would have forestalled it can avoid the responsibility only by showing that he sought his remedy promptly.” Hayman v. City of Los Angeles, 17 Cal.App.2d 674, 680, 62 P.2d 1047, 1050.

The petitioners have shown that they have exhausted all their statutory remedies in an effort to obtain from the commission a fair and impartial ruling in accordance with the express terms of the statute; that the respondents have resisted those efforts upon grounds which are technical and unreasonable; and that petitioners have no other remedy to enforce a compliance by the commission with the express terms of the act.

Let a peremptory writ issue as prayed.

NOURSE, Presiding Justice.

STURTEVANT and SPENCE, JJ., concurred.