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United Const. Workers v. New Burnside Veneer Co.

June 4, 1954



Appellee recovered a judgment of $75,000 against appellant labor union and certain of its representatives. The basis of appellee's claim was that the wrongful acts of appellants forced it to close its plant, with resultant damages.

Appellee was engaged in the manufacture of wood veneer products near Tateville, having moved its plant from East Burnside in 1950. On March 12, 1952, appellee was notified that a majority of its employees were members of appellant union and an attempt was made by the latter to negotiate a contract. Appellee refused to recognize the union and thereupon a strike was called.

Between March 18 and June 2, 1952, the plant was closed down because of the strike. An unsuccessful attempt to reopen it was made on the latter date. On June 6 appellee obtained a temporary injunction limiting the number of pickets and enjoining the use of force, violence or coercive tactics on the part of the union or its representatives. This order was agreed to by appellants. On June 12 this suit was filed and appellee has since dismantled its plant and gone out of business.

The fundamental issues in the action, submitted to a jury, were whether or not appellants conspired to intimidate, alarm and injure appellee and its employees for the purpose of preventing appellee from operating its plant, and as a proximate result thereof it was forced out of business. Appellants' contentions on this appeal will be taken up seriatim:

1. Appellants first contend they were entitled to a directed verdict because (a) there was a failure to prove any wrongful acts on their part, (b) if there were wrongful acts they were not the proximate cause of appellee's discontinuance of business, and (c) there was no competent proof of damage.

We believe there was ample evidence to justify a jury's finding that many acts committed on behalf of the union went well beyond the scope of peaceful picketing and persuasion. It was shown that several persons had been stopped by representatives of the union when going to and from the plant; persons were advised not to enter the plant; there were threats and suggestions that there would be trouble or that persons would be hurt if they attempted to go on the company property or to operate the plant; there were threats of shooting and threats of importing outsiders to make the strike effective, and also threats that a power line would be cut.

In addition to the verbal acts of union representatives, it was also shown that persons unknown had fired at or near the plant; that the boilers had been on one occasion surreptitiously drained; that the house of a managerial employee had been "rocked'; and that the boiler room of the plant had been set on fire the evening before it had been planned to re-open operations.

Appellants, while conceding that certain intemperate statements may have been made by representatives of the union, contend that the acts committed were not wrongful, principally because no one was actually hurt and no substantial damage was done. It is also contended that the persons committing some of the acts above mentioned were not identified as union representatives.

It is not necessary in establishing the use of unlawful force to prove that persons were injured or property destroyed. See Underhill v. Murphy, 1904, 117 Ky. 640, 78 S.W. 482. Persons may be intimidated without being physically harmed and threats may effectively deter persons from engaging in their normal activities. Intimidation or coercion is as wrongful as the use of force and violence. Music Hall Theatre v. Moving Picture Machine Operators Local No. 165, 249 Ky. 639, 61 S.W.2d 283. Certainly the jury could conclude from the proven acts and the chain of closely related circumstances that appellant union and its members were engaging in an unlawful course of conduct designed to prevent the operation of the plant until the demands of the union were met. See 31 Am.Jur., Labor, Sections 185, 186.

In view of the testimony of the company's president that a substantial number of striking employees had expressed their willingness to work, and in view of the acts discussed above, the jury would likewise be justified in finding that appellants' conduct was the proximate cause of appellee's decision permanently to close its plant.

With respect to damages, there was substantial evidence the plant had a going value of between $250,000 and $300,000 and that business in the past had been successful. In addition, appellee's president had, shortly before the strike commenced, negotiated a very profitable contract for the sale of its entire production for one year to a single customer. The physical plant, which appellee has been selling piecemeal, had relatively little value compared to that of the company as a going concern. We believe the uncontradicted and competent evidence of valuation was sufficient to justify the jury verdict.

2. Appellants next contend the instruction with respect to the measure of damages given by the court was erroneous. This instruction was to the effect that if the jury believed as a direct and proximate result of the acts of the appellants appellee's business enterprise was injured and damaged to the extent it was destroyed, then the jury could award appellee the difference between the fair market value of the plant immediately before and immediately after the acts complained of. Appellant takes the position that this instruction assumes appellee's business was destroyed and that recovery should have been limited to such temporary damage as may have been caused. Obviously the instruction does not assume the destruction of appellee's business by appellants because it very clearly and fairly presents that precise question to the jury. If it so believed, the measure of damages was the same as in the case of destruction of other property. The issue of temporary damage was not developed in the proof and appellants did not offer an instruction on that theory.

3. It is next contended the court should have discharged the jury because the question of Communism was improperly injected into the case. Appellee's president was asked why he decided not to sign a contract with appellant union. In substance he testified that he had made inquiry of the National Labor Relations Board and had received a telegram to the effect that the officers of this union had not taken the non-Communist oath required under the Taft-Hartley law. During the questioning of the witness on this point there was quite a colloquy between counsel with respect to the introduction of the telegram. It was, however, excluded by the court, and the court stated to the jury the legal effect of the failure on the part of the union officials to take the oath.

We do not find the admitted testimony incompetent. Whether the facts learned by appellee's president were true or not is immaterial, but he clearly had a right to explain what motivated his actions resulting in the controversy between the parties. He could explain his position just as representatives of the union could explain theirs. As a matter of fact, appellants, make a vigorous argument that appellee wrongfully refused to negotiate with the union. In view of such a charge, certainly appellee's ...

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