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Petitioner union and respondent company were parties to a collective bargaining agreement which required payment of accumulated vacation pay to qualified employees upon termination of their employment. In June 1957 the company discharged employees covered by the agreement without such payment. An action brought in the Indiana courts to recover the amounts allegedly due was dismissed in 1960 on the ground that the complaint was insufficient under state law. Almost four years later and almost seven years after the employees' discharge, the union brought this action in the Federal District Court under 301 of the Labor Management Relations Act, 1947. The Act contains no time limitation upon the bringing of an action under 301. The District Court viewed the action as based partly on the collective bargaining agreement and partly on the oral contract of each employee and held that Indiana in such case would apply its six-year statute of limitations governing contracts not in writing. The complaint was accordingly dismissed as untimely and the Court of Appeals affirmed. Held:
Stephen I. Schlossberg argued the cause for petitioner. With him on the briefs were Joseph L. Rauh, Jr., and John Silard.
Harry P. Dees argued the cause and filed a brief for respondent.
MR. JUSTICE STEWART delivered the opinion of the Court.
Section 301 of the Labor Management Relations Act, 1947, confers jurisdiction upon the federal district courts over suits upon collective bargaining contracts. 1 Nowhere [383 U.S. 696, 698] in the Act, however, is there a provision for any time limitation upon the bringing of an action under 301. The questions presented by this case arise because of the absence of such a provision.
The petitioner union and the respondent company were parties to a collective bargaining contract within the purview of 301. The contract contained a section governing vacations. One clause in this section dealt with payment of accumulated vacation pay, by providing: "Employees who qualified for a vacation in the previous year and whose employment is terminated for any reason before the vacation is taken will be paid that vacation at time of termination." On June 1, 1957, prior to the expiration of the contract, the company terminated the employment of employees covered by the agreement, but it did not pay them any accumulated vacation pay. Since that date, two lawsuits have been brought to recover amounts allegedly due. The first was a class action in early 1958, brought against the company in an Indiana court, but the court ruled that such [383 U.S. 696, 699] an action was impermissible under Indiana law. In an attempt to remedy this pleading defect, the former employees assigned their vacation pay claims to a union representative who then filed an amended complaint, but this form of action, too, was held improper under Indiana law. Thereafter, by further amended complaints, the employees sought to reform and reinstitute the class action, but once again the trial court held the complaint insufficient as a matter of state law. The court dismissed the suit in June 1960, and the judgment of dismissal was affirmed on appeal. Johnson v. Hoosier Cardinal Corp., 134 Ind. 477, 189 N. E. 2d 592.
Almost four years after the dismissal of that lawsuit by the Indiana trial court, and almost seven years after the employees had left the company, the union filed the present action in the United States District Court for the Southern District of Indiana. On the company's motion, the trial court dismissed the complaint, concluding that the suit was barred by a six-year Indiana statute of limitations. The court regarded this action as based partly upon the written collective bargaining agreement and partly upon the oral employment contract each employee had made, and it held that Indiana would apply to such a hybrid action its six-year statute governing contracts not in writing. Ind. Stat. Ann. 2-601 (1965 Supp.). 235 F. Supp. 183. The Court of Appeals for the Seventh Circuit affirmed, 346 F.2d 242, and we granted certiorari,
We note at the outset that this action was properly brought by the union under 301. There is no merit to the contention that a union may not sue to recover wages or vacation pay claimed by its members pursuant to the terms of a collective bargaining contract. Such a suit is among those "[s]uits for violation of contracts between an employer and a labor organization" that 301 was designed to permit. This conclusion is unimpaired
[383
U.S. 696, 700]
by the fact that each worker's claim may also depend upon the existence of his individual contract of employment. See J. I. Case Co. v. Labor Board,
Since this suit was properly brought under 301, the question of its timeliness is squarely presented. It is clearly a federal question, for in 301 suits the applicable law is "federal law, which the courts must fashion from the policy of our national labor laws." Textile Workers v. Lincoln Mills,
It is true that if state limitations provisions govern 301 suits, these suits will lack a uniform standard of timeliness. It is also true that the subject matter of 301 is "peculiarly one that calls for uniform law." Teamsters Local v. Lucas Flour Co., supra, at 103. Our cases have defined the need for uniformity, however, in terms that are largely inapplicable here:
That Congress did not provide a uniform limitations provision for 301 suits is not an argument for judicially creating one, unless we ignore the context of this legislative omission. It is clear that Congress gave attention to limitations problems in the Labor Management Relations Act, 1947; it enacted a six months' provision to govern unfair labor practice proceedings, 61 Stat. 146, 29 U.S.C. 160 (b) (1964 ed.), and it did so only after appreciable controversy.
5
In this context, and against the background of the relationship between Congress and the courts on the question of limitations provisions, it cannot be fairly inferred that when Congress left 301 without a uniform time limitation, it did so in the expectation that the courts would invent one. As early as 1830, this Court held that state statutes of limitations govern the timeliness of federal causes of action unless
[383
U.S. 696, 704]
Congress has specifically provided otherwise. McCluny v. Silliman, 3 Pet. 270, 277. In 1895, the question was re-examined in another context, but the conclusion remained firm. Campbell v. Haverhill,
Accordingly, since no federal provision governs, we hold that the timeliness of a 301 suit, such as the [383 U.S. 696, 705] present one, is to be determined, as a matter of federal law, by reference to the appropriate state statute of limitations. 7 This leaves two subsidiary questions to be decided. Which of Indiana's limitations provisions governs? 8 Does any tolling principle preserve the timeliness of this action?
The union argues that if the timeliness of this action is to be determined by reference to Indiana statutes, federal law precludes reference to the Indiana six-year provision governing contracts not in writing. Reference must be made instead, it is urged, to the Indiana 20-year provision governing written contracts. Ind. Stat. Ann. 2-602 (1965 Supp.). This contention rests on the view that under federal law this 301 suit must be regarded
[383
U.S. 696, 706]
as exclusively bottomed upon the written collective bargaining agreement. We agree that the characterization of this action for the purpose of selecting the appropriate state limitations provision is ultimately a question of federal law. Textile Workers v. Lincoln Mills, supra; McClaine v. Rankin, supra, But there is no reason to reject the characterization that state law would impose unless that characterization is unreasonable or otherwise inconsistent with national labor policy. Cf. Reconstruction Finance Corp. v. Beaver County,
Applying this principle, we cannot agree that federal law requires that this action be regarded as exclusively based upon a written contract. For purposes of 301 jurisdiction, we have rejected the view that a suit such as this is based solely upon the separate hiring contracts, frequently oral, between the employer and each employee. Smith v. Evening News Assn., supra. It does not follow, however, that the separate contracts of employment may not be taken into account in characterizing the nature of a specific 301 suit for the purpose of selecting the appropriate state limitations provision. Indeed, as the present case indicates, consideration of the separate contracts for that purpose is entirely acceptable. The petitioner seeks damages based upon an alleged breach of the vacation pay clause in a written collective bargaining agreement. Proof of the breach and of the measure of damages, however, both depend upon proof of the existence and duration of separate employment contracts between the employer and each of the aggrieved employees. Hence, this 301 suit may fairly be characterized as one not exclusively based upon a written contract.
Moreover, the characterization that Indiana law imposes upon this action does not lead to any conflict with [383 U.S. 696, 707] federal labor policy. Indeed, to the extent that a policy is manifest in the Labor Management Relations Act, it supports acceptance of the characterization adopted here. The six months' provision governing unfair labor practice proceedings, 61 Stat. 146, 29 U.S.C. 160 (b), suggests that relatively rapid disposition of labor disputes is a goal of federal labor law. Since state statutes of limitations governing contracts not exclusively in writing are generally shorter than those applicable to wholly written agreements, their applicability to 301 actions comports with that goal. There may, of course, be 301 actions that can only be characterized fairly as based exclusively upon a written agreement. But since many 301 actions for wages or other individual benefits will concern employment contracts of the sort involved here, there is no reason to inhibit the achievement of an identifiable goal of labor policy by precluding application of the generally shorter limitations provisions. 9
Accordingly, we accept the District Court's application of the six-year Indiana statute of limitations to this action. Cf. Bernhardt v. Polygraphic Co.,
The contention that some tolling principle saves the life of this action was raised for the first time in this Court. In any event, we find the contention without merit. In Burnett v. New York Central R. Co.,
[
Footnote 2
] See also Rule 17 (a) of the Federal Rules of Civil Procedure; Dowd Box v. Courtney,
[
Footnote 3
] See, e. g., Conley v. Gibson,
[
Footnote 4
] Our cases have spoken of the federal law applicable to 301 suits as "substantive," see, e. g., Textile Workers v. Lincoln Mills,
[ Footnote 5 ] Compare, e. g., the remarks of Senator Wagner, 93 Cong. Rec. 3323, and those of Senator Murray, 93 Cong. Rec. 4030, with the remarks of Senator Smith, 93 Cong. Rec. 4283.
[
Footnote 6
] In McAllister v. Magnolia Petroleum Co.,
[
Footnote 7
] The present suit is essentially an action for damages caused by an alleged breach of an employer's obligation embodied in a collective bargaining agreement. Such an action closely resembles an action for breach of contract cognizable at common law. Whether other 301 suits different from the present one might call for the application of other rules on timeliness, we are not required to decide, and we indicate no view whatsoever on that question. See, e. g., Holmberg v. Armbrecht,
[
Footnote 8
] The record indicates that Indiana is both the forum State and the State in which all operative events occurred. Neither party has suggested that the limitations provision of another State is relevant. There is therefore no occasion to consider whether such a choice of law should be made in accord with the principle of Klaxon Co. v. Stentor Mfg. Co.,
[
Footnote 9
] Other questions would be raised if this case presented a state law characterization of a 301 suit that reasonably described the nature of the cause of action, but required application of an unusually short or long limitations period. See, e. g., N. M. Stat. 59-3-4 (1953) (an action for wages "must be commenced within sixty 60. days from the date of discharge. . . ."). See Campbell v. Haverhill,
[
Footnote 10
] Neither party has suggested that the cause of action "accrued" on any date other than June 1, 1957, when the company terminated the employees' jobs. Cf. Rawlings v. Ray,
[ Footnote 11 ] It should be noted also that Indiana has a saving statute, Ind. Ann. Stat. 2-608 (1946 Repl. Vol.), but the union has never contended that it preserves the timeliness of this suit. [383 U.S. 696, 709]
MR. JUSTICE WHITE, with whom MR. JUSTICE DOUGLAS and MR. JUSTICE BRENNAN join, dissenting.
Certain principles are undisputed in this case. The period of limitations for 301 suits is to be determined by federal law; and, since Congress has made no express provision for any time limitation, this Court must fashion the governing rule. By adopting the statutes of the several States, the Court creates 50 or more different statutes of limitations 1 rather than fashioning a uniform rule after consideration of relevant federal and state statutes.
The Court justifies its decision in part by reliance on cases decided under the Rules of Decisions Act, 28 U.S.C. 1652 (1964 ed.), which interpreted "the silence of Congress . . . to mean that it is federal policy to adopt the local law of limitation." Holmberg v. Armbrecht,
More specifically, it is quite clear that with respect to 301 suits congressional silence extends not just to the question of limitations but encompasses the entirety of the governing legal principles. Rather than inferring from congressional silence that state law was to govern, Textile Workers v. Lincoln Mills,
The Court reasons, however, that to devise a uniform time limitation would be too "bald a form of judicial innovation." Ante, at p. 701. Cases defining a need for uniformity in 301 suits are said to be limited to matters concerning which the possible application of varying systems of law "`would inevitably exert a disruptive influence upon both the negotiation and administration of [383 U.S. 696, 711] collective agreements.'" Ante, at pp. 701-702. Since, according to the majority, the lack of a uniform statute of limitations would generally not have that effect, 2 the Court concludes that although such a uniform provision "might well constitute a desirable statutory addition, there is no justification for the drastic sort of judicial legislation that is urged upon us." Ante, at pp. 702-703.
The Court is undoubtedly correct in stating that a uniform limitations period would be desirable. Suppose, for example, that the collective bargaining contract in dispute was one made in Detroit for a multi-state unit of truck drivers and that, as is true in this case, 100 of the covered employees were discharged without payment of accumulated vacation pay. Suppose further that some of the employees were hired in Chicago and discharged in Indiana while others were hired in St. Louis, Cleveland, and Terre Haute and were discharged in Illinois, Michigan, and Iowa (in whatever combinations are preferred). Suppose, finally, that some sue in Indiana, some in other States, some in federal court, and some in state court. Simple justice dictates in such a situation [383 U.S. 696, 712] that the right of employees in different States to assert their federal claim should be equally available. Clearly there is no sense or justice in referring to 50 or more different statutes of limitations so that one employee may be barred after one year while another employee may sue any time within six years. Nor is there any reason why an employer operating under the contract in one State should be bothered with stale claims already barred as against other employers in other States.
Moreover, the Court's decision creates unnecessary complexities and opportunities for vexatious litigation, some of which are reflected in the Court's opinion. Thus the Court notes that in a situation involving multi-state contacts, such as the example given above, a federal court hearing the case would be required to decide whether to apply a federal, or the forum State's conflict of laws rules to select the State of governing law. If this Court ultimately holds that a federal conflict of laws rule is to govern in federal court suits, the additional question will be presented of whether the federal conflict of laws rule must also be applied by state courts or whether they may continue to apply their own conflict of laws rule. Whatever conflict of laws rule, state or federal, is selected, there will remain the difficult task of applying that rule to find the State whose limitations statute is to control. In cases not involving multi-state contacts, the court may have to choose between two or more state statutes; here the choice is between the limitations period for suits on written contracts and the period for suits on oral contracts. Under today's decision, this choice is to be governed by the State's characterization of the federal action (or a federal court's Delphic opinion of what that characterization would be), "unless that characterization is unreasonable or otherwise inconsistent with national labor policy." Ante, at p. 706. The governing [383 U.S. 696, 713] state limitations statute, having finally been determined, is to be applied unless the period is "unusually short or long." 3 Ante, at p. 707, n. 9. The problems we have indicated are merely illustrative of the complex questions that must be decided under the Court's approach before it can be determined which of several competing state statutes is to be applied and whether such application is reasonable when tested by the federal labor policy; undoubtedly the fertile imagination of counsel will conceive additional intricacies. The desirability of a single, uniform, federal statute to further justice and to avoid such litigation-creating complexities was of course recognized by Congress in passing the statutes, to which the majority refers, that overruled in particular areas past refusals of this Court to fashion such a uniform rule.
The case for the Court's decision thus ultimately comes down to the proposition that fashioning a uniform federal statute would involve too bald an exercise of judicial innovation. This is an argument I have difficulty in fathoming. Courts have not always been reluctant to "create" statutes of limitations, the common-law doctrine of prescription by which judgments are presumed to have been paid after the lapse of 20 years, see Gaines v. Miller,
[ Footnote 1 ] The Court's approach adopts (and thereby creates as federal law) at least one limitations statute for each State and Territory. In many States it adopts a multitude of limitations provisions, each applicable to a particular type of 301 suit. The Court's opinion suggests, for example, that had the present suit been "exclusively based upon a written contract," ante, at p. 706, the Indiana 20-year, rather than the six-year, statute would have governed.
[
Footnote 2
] However, limitations questions will have an impact on the negotiation and administration of the collective agreement in many instances - for example, if the parties decide to limit by contract the period for bringing suit. The laws of the several States vary with respect to the enforceability of such contractual limitations periods, particularly when it is asserted that the agreed period is unreasonable, see Williston on Contracts 183, at 711, n. 10 (Jaeger 3d ed. 1957); Note, 63 Harv. L. Rev. 1177, 1181-1182 (1950). It may be assumed that, under the test advanced by the majority, uniform federal law will be fashioned to determine their validity, just as, at least in some circumstances, federal law will determine when the cause of action arose, see Cope v. Anderson,
[ Footnote 3 ] Unfortunately the Court provides no enlightenment concerning where we are to look for a limitations period should the state statute be held unreasonable. Perhaps in extremis even the Court's approach will require the kind of innovation it now rejects.
[ Footnote 4 ] Nor do I intimate any opinion concerning the tolling question mooted in the Court's opinion. [383 U.S. 696, 715]
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Citation: 383 U.S. 696
No. 387
Argued: January 27, 1966
Decided: March 24, 1966
Court: United States Supreme Court
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