THIRD DIVISION
(Supplemental)
DULUTH, MISSABE AND IRON RANGE
RAILWAY COMPANY
(1) The Carrier violated the effective Agreement and the understanding in connection therewith, when it assigned the work of constructing a new Diesel Repair Shop Building at Proctor to contract without first handling the matter in writing with the employes' authorized representatives;
"SUPPLEMENTAL AGREEMENT
between the
DULUTH, MISSABE AND IRON RANGE RAILWAY COMPANY
and the
Notwithstanding the provisions of Rule 36 of the agreement dated June 1, 1953 between these parties, it is agreed that the following will remain in effect until changed in accordance with the provisions of the Railway Labor Act.
For all the reasons given, the claim should be dismissed and if not dismissed, the claim should be denied in its entirety.
All relevant facts and arguments involved in this dispute have heretofore been made known to the Employes' representatives.
OPINION OF BOARD: The Organization contends that the agreement and understanding between it and the Carrier was violated when Carrier on December 4, 1956 let a contract to a General Contractor for the construction of a building to house and service Diesel locomotives, without first notifying the General Chairman in writing of the decision to do so, affording the General Chairman an opportunity to discuss the matter in conference with Carrier's representatives.
We must first determine the existence, date and extent of the "understanding." Claimant says the date was March 7, 1956 that it was then oral, then put into effect, but later, September 24, 1958, reduced to writing and signed by the parties.
The record shows on July 11, 1955 the General Chairman gave notice under the Railway Labor Act as amended, of a desire to confer on an agreement that "all work covered by Schedule 3, effective June 1, 1953 shall be performed by employes covered by that agreement,".
"APPENDIX A
"SUPPLEMENTAL AGREEMENT
"Between
"DULUTH, MISSABE AND IRON RANGE RAILWAY COMPANY
"Department of Personnel
"Confirming conference held in room 506 Wolvin Building on September 12, 1955 at which discussion was continued concerning your formal notice to modify the present supplemental agreement dated June 1, 1963 covering the contracting of work in the Maintenance of Way Department:
"You were also informed that the Company would make every reasonable effort to perform all maintenance work with our employes and in consideration of this you were urged to hold your notice of July 11, 1955 in abeyance with the understanding that should you desire at a later date to again press for the change requested you would be at liberty to do so.
"This will acknowledge your letter of September 20th in which you refer to conference held in Room 606 Wolvin Building on Septem- 11984-24 7 g3
"We note that you use the words 'maintenance work'. If you have in mind 'maintenance and repair work' only, and exclude 'new work' we cannot agree to your suggestion. We were talking about all work in the 'Maintenance of Way and Structures Department' as covered in Scope Rule 1 of Schedule No. 3 which became effective June 1, 1953.
"Please refer to your letter of September 5, 1958 and our conference September 22, 1958 on the subject of re-establishing the understandings reached as a result of your July 11, 1955 notice regarding 1199.1-25 784
In addition the record shows letters from Carrier's Chief Engineer H. A. Smith to Mr. Louis Emerson, General Chairman notifying him of the desire of Carrier to contract out numerous construction jobs. Letters were dated March 15, 1956, one April 10, 1956, June 11, 1956, June 15, 1956, June 20, 1956, June 26, 1956, December 26, 1956 most of them asking and receiving concurrence of the General Chairman. 11984-26 785
In our opinion the correspondence and acts of the parties conclusively establishes the understanding; that it was effective and in practice for a substantial length of time prior to the letting of the contract December 4, 1956. Such understanding and its acceptance by the parties was not postponed until 1958. Why the understanding was disregarded by the Carrier in this instance is not shown. Carrier simply asserts there was no such contractual provisions shown to exist at the time they let the contract December 4, 1956, or that Claimants could not have worked for the contractor. No basis of fact is shown in the record to support those assertions.
Carrier and Claimant both make various contentions that matters set forth in the record were not brought up on the property. The basic question of the existence, date and extent of the "understanding" was brought up on the property, and in our opinion it was established by the evidence there. It was also agreed that the understanding, "will be observed by the railroad company for as long as your organization continues to hold in abeyance its notice of July 11, 1955;". It is admitted that Carrier did not notify the General Chairman of Carrier's intention to farm out the work in question, as required by the understanding. The agreement was therefore violated. Award 7060-Carter; 6199-Begley; 3215-Carter; 5041-Carter; 6645-Bakke.
Carrier says that to allow part 2 of the claim is to inflict a penalty upon the Carrier without a showing of loss on part of Claimants to justify it. We hold that to allow the claim for monetary relief is not a penalty. It is merely the consequences of the violation. See Award 11701-Engelstein.
FINDINGS: The Third Division of the Adjustment Board, after giving the parties to this dispute due notice of hearing thereon, and upon the whole record and all the evidence, finds and holds:
That the Carrier and the Employes involved in this dispute are respectively Carrier and Employes within the meaning of the Railway Labor Act, as approved June 21, 1934;
That this Division of the Adjustment Board has jurisdiction over the dispute involved herein; and
CARRIER MEMBERS' DISSENT TO AWARD 11984
DOCKET MW-11096
This Award is palpably wrong. There is no competent evidence in the record to support the conclusions upon which the Award is based. There is 11984-27 786
no showing that Claimants would have been entitled to damages even if the alleged breach of contract had occurred.
The specific claim submitted to the Board is that on December 4, 1956, Carrier violated the "effective Agreement" when it assigned a $1,900,000 new building construction project to a private contractor "without first handling the matter in writing with the employes' authorized representatives." Carrier denies that the "effective Agreement" contains any provision requiring it to first handle the matter with the Employes' representatives. The Award states:
Let us examine the matters in the record which are cited as the basis for this conclusion that the alleged understanding was "effective and in practice for a substantial length of time" prior to December 4, 1956.
First, reference is made to Carrier's letter to the General Chairman dated September 20, 1955. In this letter Carrier concedes that the employes' representative had been:
This letter said nothing of new construction, and nothing of handling any matter with the employes' representatives in writing. The terms of that letter agreement cannot be varied by parol evidence. Awards 5059 (Kelliher), 9545 (Bernstein), 10442 (Gray). The Referee next considers the General Chairman's reply of October 10, 1955, to the cited letter of Carrier, in which the General Chairman also said nothing about handling anything in writing with the employes, but did protest that new construction as well as "maintenance work" should be included in the work that Carrier was to "make every reasonable effort to perform" with its own employes. Significantly, the employes did not place in evidence the Carrier's response to this letter of the General Chairman, and this leaves us with the necessary inference that such response was unfavorable to their claim. The employes themselves have not contended in their initial submission that Carrier's letter of September 20 and the General Chairman's reply of October 10, 1955, evidenced any understanding that Carrier would not contract out any type of work without first handling the matter with the employes in writing. They assert in their Statement of Facts:
This brings us to a consideration of the employes' evidence that there was an oral understanding reached on March 7 and 28, 1956.
There is nothing in the record to support the employes' contention that the alleged agreement was made in the conferences held March 7 and 28. They cite the uncorroborated statements of the General Chairman in his own personal memorandum of the conference. The officer of Carrier who participated in the conference emphatically denied that any such understanding was made. The uncorroborated statements of either Carrier or employe representatives, which are denied by the representatives of the other side, are not accepted as evidence by this Board. "The Board feels that the mere statement of the Division Chairman is not evidence." Award 8486 (Vokoun), also Awards 9261 (Hornbeck), 9788 (Fleming), 10067 (Weston), 10390 (Dugan), 11118 (Sheri.dan), 11280 (Rose). The employes submitted no corroborating evidence in their initial submission; in fact, they did not even allege that any such evidence existed.
This brings us to the final matters in the record cited to establish that the alleged understanding was made and became a part of the effective Agreement prior to the letting of the contract on December 4, 1956, namely, the alleged letters cited in the third from last paragraph of the Opinion of Board. All of these alleged copies of letters were attached to the rebuttal statement submitted by the employes. These letters would not establish the existence of the alleged agreement in any event, but we cannot consider them because our rules and our uniform decisions require that all such evidence must be included in the initial submission, along with a showing that it has been submitted on the property-Circular No. 1, Awards 11878 (Christian), 11128 (Boyd, 11081 (Ray), 10985 (Hall), 10740 (Miller), 10385 (Dugan), 10067 (Weston).
There is absolutely nothing in the record to support the conclusion that -prior to December 4, 1956, Carrier had entered into a binding Agreement that it would not contract out a $1,900,000 new construction project without first .handling the matter with the employes in writing.
The statement with respect to damages in the last paragraph of the Opinion reveals an unfortunate failure to comprehend the law of damages .and Carrier's position with respect to the application thereof in this case. Both the law and Carrier's position on this point are crystal clear. In a recent case .dealing with this issue in an enforcement proceeding, the law has been clearly .stated by the United States District Court for Colorado to be:
"4. Since the collective bargaining agreement contains no provisions for punitive damages for contractual violations such as that found in this case, damages, if any, must be assessed on the basis of ordinary contract law. Petitioners here have not been damaged monetarily by the contractual violation, and they are, consequently, under well-settled principles of contract law, entitled to no more than nominal damages. The award of the Railroad Adjustment Board, insofar as its awards damages of one day's pay for each date for which a claim was filed is erroneous, and the award of damages predicated upon that basis must be set aside." (Brotherhood of Railroad Trainmen v. Denver $ Rio Grande Western R. Co., No. 7348, U.S.D.C., Dist. ,of Colorado, 1963.)
Carrier's position is equally clear. Carrier recognizes the "make whole -theory" for "employes adversely affected", but argues that no employe was adversely affected here. It is obvious from the record that Carrier is correct. 11984-2s qgg
The employes have not even attempted to establish a casual connection between Carrier's alleged violation of the Agreement in failing to negotiate before letting the contract, and any loss whatever on the part of any of the Claimants. To the contrary, they have advanced the obviously erroneous argument that the Board has authority to award a penalty.
It is clear that Part 2 of the claim would not have been valid even if the violation erroneously alleged in Part 1 of the claim had actually occurred.