While a proceeding for reorganization of a railroad under § 77
of the Bankruptcy Act was pending in the District Court, the
trustees agreed with the bargaining representative of "yard
conductors" that certain trains which had been manned by "road
conductors" should be manned by "yard conductors." Relying on
earlier agreements, the bargaining representative of the road
conductors petitioned the court to instruct the trustees not to
displace the road conductors and to enjoin such action as long as
the earlier agreements were not altered in accordance with the
Railway Labor Act. The court determined that the yard conductors
were entitled to man the trains in question, and dismissed the
1. So far as the order constituted instructions to the trustees,
it was within the supervisory power of the District Court as a
bankruptcy court, and is affirmed. Pp. 326 U. S. 562
326 U. S.
2. The District Court should not have interpreted the agreements
for purposes of finally adjudicating the dispute between the unions
and the railroad, but should stay dismissal of the cause so as to
afford opportunity for application to the Adjustment Board for an
interpretation of the agreements pursuant to the Railway Labor Act.
3. Congress having created by the Railway Labor Act an agency
especially competent and specifically designated to settle such a
labor dispute as is here involved, the court should exercise
equitable discretion to give that agency the first opportunity to
pass on the issue. The extraordinary relief of an injunction should
be withheld at least until then. P. 326 U. S.
4. Any rights clearly revealed by an interpretation of the
agreements by the Adjustment Board might then, if the situation
warrants, be protected in this proceeding. P. 326 U. S.
145 F.2d 351 modified.
Certiorari, 325 U.S. 849, to review a judgment which, upon
appeal from an order of the bankruptcy court, remanded
Page 326 U. S. 562
the cause for dismissal without prejudice to any action or
proceeding not in conflict with the Railway Labor Act.
MR. JUSTICE BLACK delivered the opinion of the Court.
This case requires us to consider to what extent a Federal
District Court having charge of a railroad reorganization has power
to adjudicate a jurisdictional dispute involving the railroad and
two employee accredited bargaining agents in view of the provisions
in the Railway Labor Act, 45 U.S.C. § 151 et seq.,
such power to the administrative agencies established thereunder.
Each union claims that its respective collective bargaining
agreement entitles it to supply conductors for five daily freight
trains operated within the Elizabeth Port, New Jersey, yards of the
railroad, and both pressed their contentions on the reorganization
trustees appointed under the provisions of § 77 of the Bankruptcy
Act. 11 U.S.C. § 205. The two unions are the Order of Railway
Conductors (ORC), which represents road conductors who ordinarily
operate trains outside the yards, and the Brotherhood of Railroad
Trainmen (BRT), which represents yard conductors who ordinarily
operate trains inside the yards. But here, the practice over a
period of years had been that, at times, yard conductors manned
some trains outside the yard and road conductors manned some
Page 326 U. S. 563
within the yard, including the five freight trains here
involved. In 1940, the railroad, in response to pressure by the
ORC, agreed that, thereafter, only road conductors would man the
outside trains. However, ORC conductors continued to operate the
five daily freight trains within the yard. In 1943, the railroad
was prevailed upon by the BRT to agree to substitute BRT yard
conductors for the ORC conductors operating these five trains.
Thereupon, ORC brought this suit in the reorganization court. It
alleged that its members had for the past 35 years operated the
trains in issue as a result of negotiations as to rules, rates of
pay, and working conditions between it and the railroad, and that
the 1940 contract specifically provided that this situation would
not be changed without further agreement. Thus, the proposed
displacement of ORC conductors would violate § 6 of the Railway
Labor Act, which makes it unlawful for a carrier or employee
representatives to change "pay, rules, or working conditions"
unless 30 days written notice of the intended change shall have
been given and the controversy has been finally acted upon by the
Mediation Board. [Footnote 1
The ORC asked the court to instruct its
Page 326 U. S. 564
trustees not to displace road conductors and to enjoin them
permanently from taking such action so long as ORC's contracts with
the road were not altered in accordance with the provisions of the
Railway Labor Act.
Answers were filed by the trustees and the BRT as intervenor.
The case was referred to a Master, who, after a hearing, found that
ORC's collective bargaining contracts did not provide that its
conductors were to operate the five freight trains, and that the
BRT contract allotted these lines to its members. The District
Court sustained these findings, and accordingly dismissed the
petition on the merits. The Circuit Court of Appeals held that the
petition should be dismissed on jurisdictional grounds because it
thought that the remedies of the Railway Labor Act for the
settlement of disputes such as here involved are exclusive. 145
F.2d 351. It further stated that, if it should be mistaken on the
jurisdictional question, then it agreed with the District Court
that the road conductors must lose on the merits.
Section 77(n) of the Bankruptcy Act provides that
"No judge or trustee acting under this Act shall change the
wages or working conditions of railroad employees except in the
manner prescribed in the Railway Labor Act. . . ."
47 Stat. 1481. Section 1 of the Railway Labor Act defines a
carrier subject to it as including "any receiver, trustee, or other
individual or body, judicial or otherwise, when in the possession
of the business of any such carrier.' . . ." And § 2, Seventh,
of the Act provides that
"No carrier, its officers, or agents shall change the rates of
pay, rules, or working conditions of its employees, as a class, as
embodied in agreements except in the manner prescribed in such
agreement or in § 6 of this Act."
Section 6, as we have seen, prohibits such changes unless notice
is first given and its requirements are otherwise complied with.
Section 2, Tenth, of the Act makes it a
Page 326 U. S. 565
misdemeanor, punishable by both fine and imprisonment for a
carrier willfully to violate § 6.
These sections make it clear that the only conduct which would
violate § 6 is a change of those working conditions which are
"embodied" in agreements. But the answers here specifically denied
that the ORC agreements provided that road conductors operate the
five trains in question. This put in issue the meaning of the
contracts that allegedly embodied the working conditions which the
trustees were about to change. The court therefore had to interpret
these contracts before it could find that § 6 had been
In interpreting the contracts, the court might act in two
distinct capacities. First, it might do so in the capacity of a
"judicial" "body" in the "possession of the business," or a
"carrier" within the meaning of § 1 of the Railway Labor Act. As
such, it would have to interpret the contracts in order to exercise
the jurisdiction conferred by the Bankruptcy Act [Footnote 2
] to control its trustees so as to
insure the preservation and proper administration of the debtor's
estate. But such instructions, while binding on the trustees and,
just as any other order, subject to appellate review, amount to no
more than the decision any other carrier would sooner or later make
about the course it must follow, and therefore cannot finally
settle the dispute between Union and employer.
Finally to settle that dispute, the reorganization court would
have to act in the further capacity of a tribunal empowered to
grant the equitable relief sought, even though granting that relief
requires interpretation of these contracts. But Congress has
specifically provided for a tribunal to interpret contracts such as
these in order finally to settle a labor dispute. Section 3 First
(i) of the Railway
Page 326 U. S. 566
Labor Act provides that disputes between a carrier and its
"growing out of . . . the interpretation or application of
agreements concerning rates of pay, rules, or working conditions .
. . may be referred by either party to . . . the Adjustment
The Board cannot only order reinstatement of the employees,
should they actually be discharged, but it can also, under § 3,
First (o) and (p), grant a money award subject to judicial review
with an allowance for attorney's fees should the award be
sustained. Not only has Congress thus designated an agency
peculiarly competent to handle the basic question here involved,
but, as we have indicated in several recent cases in which we had
occasion to discuss the history and purpose of the Railway Labor
Act, it also intended to leave a minimum responsibility to the
courts. [Footnote 3
Of course, where the statute is so obviously violated that "a
sacrifice or obliteration of a right which Congress . . . created"
] to protect the
interest of individuals or the public is clearly shown, a court of
equity could, in a proper case, intervene. Texas & N.O. R.
Co. v. Brotherhood of Clerks, 281 U.
; Virginian R. Co. v. System Federation,
300 U. S. 515
here, it does not clearly appear whether the statute has been
violated or complied with, or that the threatened action "would be
prejudicial to the public interest." Pennsylvania v.
Williams, 294 U. S. 176
294 U. S. 185
We have seen that, in order to reach a final decision on that
question, the court first had to interpret the terms of ORC's
collective bargaining agreements. The record shows, however, that
interpretation of these contracts involves more than the mere
construction of a "document" in terms of the ordinary meaning of
Page 326 U. S. 567
and their position. See Brown Lumber Co. v. L. & N. R.
Co., 299 U. S. 393
299 U. S. 396
Great Northern R. Co. v. Merchants Elevator Co.,
259 U. S. 285
259 U. S. 291
For ORC's agreements with the railroad must be read in the light of
others between the railroad and BRT. And, since all parties seek to
support their particular interpretation of these agreements by
evidence as to usage, practice, and custom, that too must be taken
into account and properly understood. The factual question is
intricate and technical. An agency especially competent and
specifically designated to deal with it has been created by
Congress. Under these circumstances, the court should exercise
equitable discretion to give that agency the first opportunity to
pass on the issue. Certainly the extraordinary relief of an
injunction should be withheld at least until then. See Thompson
v. Magnolia Petroleum Co., 309 U. S. 478
309 U. S.
-484; Burford v. Sun Oil Co., 319 U.
. Only after the Adjustment Board acts, but not
until then, can it plainly appear that such relief is necessary to
insure compliance with the statute. Until such time, ORC cannot
show irreparable loss and inadequacy of the legal remedy. The court
of equity should therefore in the exercise of its discretion stay
its hand. Lawrence v. St. Louis-San Francisco R. Co.,
274 U. S. 588
274 U. S.
-3, and other cases cited in Myers v. Bethlehem
Shipbuilding Corp., 303 U. S. 41
303 U. S. 51
note 9; Natural Gas Co. v. Slattery, 302 U.
We hold that the District Court had supervisory power to
instruct its trustees as it did. And a review of the evidence
persuades us that the court's findings on which such instructions
were based are not clearly erroneous. To the extent that its order
constitutes instructions to its trustees, it is affirmed. Of
course, in this respect, it is no more binding on the Adjustment
Board than the action of any other carrier. But the court should
not have interpreted the contracts for purposes of finally
adjudicating the dispute
Page 326 U. S. 568
between the unions and the railroad. The dismissal of the cause
should therefore be stayed by the District Court, so as to give an
opportunity for application to the Adjustment Board for an
interpretation of the agreements. Any rights clearly revealed by
such an interpretation might then, if the situation warrants, be
protected in this proceeding. [Footnote 5
It is so ordered.
MR. JUSTICE JACKSON took no part in the consideration or
decision of this case.
"Sec. 6. Carriers and representatives of the employees shall
give at least thirty days' written notice of an intended change in
agreements affecting rates of pay, rules, or working conditions,
and the time and place for the beginning of conference between the
representatives of the parties interested in such intended changes
shall be agreed upon within ten days after the receipt of said
notice, and said time shall be within the thirty days provided in
the notice. In every case where such notice of intended change has
been given, or conferences are being held with reference thereto,
or the services of the Mediation Board have been requested by
either party, or said Board has proffered its services, rates of
pay, rules, or working conditions shall not be altered by the
carrier until the controversy has been finally acted upon, as
required by section 5 of this Act, by the Mediation Board, unless a
period of ten days has elapsed after termination of conferences
without request for or proffer of the services of the Mediation
Subdivision c of § 77 of the Act, which
provides that action of trustees in administering an estate shall
be "subject to the control of the judge."
General Committee v. M.K.T. R. Co., 320 U.
; Switchmen's Union v. Board,
320 U. S. 297
Trainmen v. Toledo P. & W. R. Co., 321 U. S.
; Telegraphers v. Railway Express Agency,
321 U. S. 342
Switchmen's Union v. Board, supra, 320 U. S.
Mitchell Coal Co. v. Pennsylvania R. Co., 230 U.
, 230 U. S.
MR. JUSTICE RUTLEDGE, dissenting in part.
I agree that the District Court should retain jurisdiction of
the cause pending interpretation of the agreements in the procedure
provided by the Railway Labor Act for submitting such questions to
the Adjustment Board. Section 77(n) of the Bankruptcy Act was not
intended, I think, to give the District Court jurisdiction to
determine whether a "change in agreements affecting rates of pay,
rules, or working conditions" within the meaning of § 6 has, in
fact, taken place. Its sole effect is to require a bankruptcy court
to follow the procedure set up by the Railway Labor Act.
In my opinion, however, petitioners are entitled to immediate
temporary relief pending the determination of the Adjustment Board
in order to assure compliance with § 6 if the Board should decide
in their favor.
Section 6 enjoins a clear and positive duty on the part of
carriers and employees -- a duty which is judicially enforceable,
since no other remedy is provided. [Footnote 2/1
] The opinion
Page 326 U. S. 569
of the Court so rules, as I understand it, for otherwise there
would be no reason for holding the cause. But if, pending the
Board's determination, [Footnote
] the change forbidden by § 6 takes place and the Board's
decision turns out to be in favor of the petitioners, the very
purpose of § 6 will have been defeated. Its object is to maintain
the status quo,
pending the expiration of the period
provided by the section for allowing the processes of negotiation,
mediation, and conciliation to have play. It is to prevent
Page 326 U. S. 570
changes being made until these processes have been exhausted or
the prescribed waiting period has expired without bringing them
into effect. See Trainmen v. Toledo, P. & W. R. Co.,
321 U. S. 50
cf. Elgin, J. & E. R. Co. v. Burley, 325 U.
The decision of the Board will not restore this rightful
for the period required for making its
determination, including the time now gone by, or, in fact, for any
later period. The only relief the Board can give is either "an
administrative declaratory determination" or an award of money
damages, subject to the special provision for judicial review.
Although the latter remedy would afford partial vindication of
private rights, it does not safeguard the public interest, in
accordance with the primary design of § 6. [Footnote 2/3
] And, in many cases, it may be impossible
for a court to effectuate the Board's decision for the future with
adequate restorative measures. [Footnote 2/4
Accordingly, I think the District Court should grant temporary
relief to ORC, as was done at the beginning of this cause,
] until the rights of
the parties have been ascertained and permanent relief is given or
Page 326 U. S. 571
have made a prima facie
case [Footnote 2/6
] not only for holding the cause pending the
outcome of the proceedings before the Adjustment Board, but also
for temporary injunctive relief pending that decision. Without such
relief, the public interest will not be adequately protected, nor
will the court's jurisdiction be preserved in the sense of power to
afford the full relief required by the policy of the Act.
Texas & N.O. R. Co. v. Brotherhood of Clerks,
281 U. S. 548
Virginia R. Co. v. System Federation, 300 U.
; Switchmen's Union v. National Mediation
Board, 320 U. S. 297
General Committee v. Missouri-Kansas-Texas R. Co.,
320 U. S. 323
320 U. S.
as to adequacy of the remedy
before the Adjustment Board.
The situation in this case is unusual because resort must be had
to the Adjustment Board before it can be determined whether the
forbidden change has been proposed or has taken place in fact.
Whether the relief sought should be granted depends on whether
the Adjustment Board finds that the 1943 contract with BRT, or
action taken thereunder, constitutes a "change in agreements
affecting rates of pay, rules, or working conditions" within the
meaning of § 6, or one in "the rates of pay, rules, or working
conditions of its employees, as a class, as embodied in
agreements," except as provided in § 6, within the meaning of § 2,
Seventh. Cf. also
§ 77(n) of the Bankruptcy Act. This, in
turn, will depend upon the effect which the Board finds should be
given to the prior agreements, including not only the 1940 contract
with ORC, but the basic agreements of 1927 and 1928 with ORC and
BRT, respectively, as affected by the establishment of switching
limits in 1929 and other matters bearing upon the interpretation of
the written contracts and the rights of the parties.
Only after the Adjustment Board has acted can it be known
whether a change in violation of § 6 was proposed or brought about
through the 1943 agreement. If petitioners are correct in their
view of their rights on the merits, and the Adjustment Board so
finds, the 1943 contract and the action taken under it were in
violation of § 6. If respondents are right as to the effect of the
agreements made prior to 1943, and the Board so finds, no "change"
in violation of § 6 was brought about by the 1943 contract, which,
in that event, becomes merely declaratory of preexisting rights.
The crucial issue is whether the 1943 agreement "changed" -- that
is, altered the terms of preexisting contractual rights -- or
merely declared them, a question which only the Adjustment Board
can decide, initially at any rate, since it requires interpretation
of existing collective agreements, not the making of new or
different ones. Cf. Elgin, J. & E. R. Co. v. Burley,
325 U. S. 711
In providing a waiting period before final rupture, with leeway
for mediation and conciliation to work, § 6 has the obvious purpose
not only to prevent infringement of private rights, but, more
especially, to save the public from possible disruption of service.
Although only five jobs are involved in this jurisdictional
dispute, another may involve 500 or 5,000. Ordering the
reinstatement of any considerable number of men, once they have
been wrongfully thrown out, to displace others who have taken their
places itself involves the very kind of disruption, or possibility
for it, which Congress sought to ward off by the provisions of § 6.
And it is common knowledge that strikes involving large numbers may
arise from an employer's adverse action affecting directly only a
few employees, or even one.
The Court granted a stay order upon filing of the petition which
remained in effect until April 5, 1943, when the order of reference
to the master was made. Thereafter, the trustees made effective the
1943 contract with BRT, and, in my opinion, by this action,
violated § 6.
The decision of the Court implies that the petitioners' case is
not frivolous. That it is not is borne out by the following facts,
The trustees and BRT do not deny that ORC members had performed
the work in question continuously for more than thirty-five years
or exclusively until the contract of 1943 with BRT was made and put
into effect. They allege no protest against this arrangement until
shortly after the 1940 agreement with ORC
In 1929, the carrier established switching limit boundaries.
Respondents say the effect of establishing these limits was
generally that yardmen, represented by BRT, should not perform work
outside of them, and that roadmen, represented by ORC, should not
perform work within them. The five drills in question lie within
the switching limits. ORC contends that the fixing of switching
limits was not intended to change the previous practice under which
road conductors had customarily manned the five drills. It points
to the fact that road conductors continued to work on the five
drills after the establishment of switching limits, and to the
further fact that, by the agreement made in 1940 between ORC and
the carrier, the latter agreed not to change the then present
method of assigning conductors. ORC also maintains that the basic
agreements, taken in conjunction with the 1929 establishment of
switching limits, did not prescribe territorial priorities, but
merely provided for rates of pay to be applicable within and
without the limits established.