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Ludwig Honold Manufacturing Co. v. Fletcher

decided: January 14, 1969.

LUDWIG HONOLD MANUFACTURING COMPANY, APPELLEE
v.
HAROLD A. FLETCHER ET AL., APPELLANTS



Hastie, Chief Judge, and Seitz and Aldisert, Circuit Judges.

Author: Aldisert

ALDISERT, C. J.:

The District Court vacated a labor arbitration award in a grievance case which involved a plant promotion. It held that the arbitrator had exceeded his authority in the interpretation of the collective bargaining agreement.

Fletcher, the employee who won the award, and his union, Local 416, have appealed from the order of the court below. 275 F. Supp. 776 (E.D. Pa. 1967).*fn1

Initially, it should be emphasized that this case does not involve the question of the arbitrability of the dispute. We are not to decide whether the arbitrator had the power or jurisdiction to hear the grievance in question.*fn2 The parties agree that the grievance was a proper subject of arbitration. The controversy arises over the arbitrator's interpretation of provisions of the agreement, specifically, that portion governing the promotion of personnel within certain job classifications.

I.

Before reaching the issue of whether the District Court erred in vacating the award, we have this threshold question to consider: what is the proper role of a court in reviewing an arbitrator's interpretation of provisions of a collective bargaining agreement?

The Supreme Court has addressed itself to this specific point in United Steelworkers of America v. Enterprise Wheel and Car Corp., 363 U.S. 593, 4 L. Ed. 2d 1424, 80 S. Ct. 1358 (1960): "It is the arbitrator's construction which was bargained for and so far as the arbitrator's decision concerns construction of the contract, the courts have no business overruling him because their interpretation of the contract is different from his."*fn3

"Nevertheless, an arbitrator is confined to interpretation and application of the collective bargaining agreement; he does not sit to dispense his own brand of industrial justice. He may of course look for guidance from many sources, yet his award is legitimate only so long as it draws its essence from the collective bargaining agreement. When the arbitrator's words manifest an infidelity to this obligation, courts have no choice but to refuse enforcement of the award."

363 U.S. at 597.

Enterprise enunciated a basic philosophy that was to apply to all labor arbitration cases. It elevated the arbitrator to an exalted status -- emphasizing that there would be no interference with his award simply because a reviewing court differed with him in its interpretation of provisions of the contract. At the same time, it held a check-rein on him -- confining his zone of action to the four corners of the collective bargaining agreement. Although the language setting forth these guidelines was precise and uncomplicated, one problem has emanated from the cases which have followed Enterprise : that of formulating a consistent and workable standard to be utilized by the courts in exercising the function of review. Circuit and District Court decisions have not exuded uniformity in translating the "essence" test into a pronouncement of the appropriate extent or limitation of judicial review of the arbitrator's interpretation.

Each case seems to have fashioned its own standard, and among those variously employed have been: the reviewing court should not disturb the award so long as the interpretation was not arbitrary,*fn4 or "even though the award permits the inference that the arbitrator may have exceeded his authority",*fn5 or merely because it believes that sound legal principles were not applied;*fn6 the court should interfere "where the arbitrator clearly went beyond the scope of the submission",*fn7 or where "the authority to make . . . award cannot be found or legitimately assumed from the terms of the arbitration agreement",*fn8 or if the arbitrator made a determination not required for the resolution of the dispute.*fn9

Three decisions suggest no review whatsoever of the arbitrator's interpretations: construction and interpretation is not for the reviewing court;*fn10 there should be no review on the merits at all;*fn11 review is confined to the question of whether the union agreed to arbitrate or give arbitrator power to make the award.*fn12

In H.K. Porter Co., Inc. v. United Saw, File and Steel Products Workers, 333 F.2d 596, 602 (3 Cir. 1964), this court vacated an arbitrator's award because there was "no ground ...


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