author: HENRY F. WERKER, District Judge.

text:
    CONSOLIDATED RAIL CORPORATION, Plaintiff, v. NEVINS-PETRILLO WAREHOUSE & DISTRIBUTION SYSTEMS, INC., and Jeffrey Nevins, Defendants.
    No. 79 Civ. 2588 (HFW).
    United States District Court, S.D. New York.
    June 1, 1983.
    Michael J. Siris, New York City, for Conrail.
    Arthur Liberstein, P.C., New York City, for Nevins-Petrillo.
   MEMORANDUM DECISION

HENRY F. WERKER, District Judge.

Plaintiff Consolidated Rail Corporation (Conrail) commenced this action under the Interstate Commerce Act to recover demur-rage and related transportation charges from defendant Nevins-Petrillo Warehouse & Distribution Systems, Inc. (Nevins-Petril-lo). Nevins-Petrillo is a New York corporation engaged in the business of unloading, warehousing and distributing freight moved by rail. During the period relevant to this action, Nevins-Petrillo owned and operated a warehouse which was adjacent to Conrail’s Harlem River/Oak Point railroad yards in the Bronx, New York. Conrail contends the charges accrued under duly filed tariffs during certain months of 1977, 1978 and 1979.

A bench trial was held on April 19 and 20, 1983. At the close of the trial, the court dismissed the third-party complaint against third-party defendant Armel Ice Cream Company, Inc. (Armel), and directed Conrail and Nevins-Petrillo to submit proposed findings of fact and conclusions of law by May 20, 1983.

The court has considered the exhibits received in evidence, the testimony of the witnesses, the trial transcript, and memo-randa of law submitted by the parties. It finds that Conrail is entitled to recover demurrage charges in the amount of $130,-410.

The following constitute the court’s findings of fact and conclusions of law.

I.

1. Prior to the delivery of the rail shipments which are the subject of this action, Nevins-Petrillo asked Conrail to grant it credit to cover the payment of transportation charges which would arise in connection with Conrail deliveries to the Nevins-Petrillo warehouse. By letter dated November 19, 1976 (exhibit 1 in evidence), Conrail forwarded to Nevins-Petrillo for completion blank copies of the Demurrage Average Agreement Application, Credit Application, and Guaranty form.

2. In December 1976, Nevins-Petrillo submitted to Conrail its completed “Application for Settlement of Car Demurrage Charges under the Average Agreement Plan.” (exhibit 2 in evidence). The application was signed by Jeff Nevins, president of Nevins-Petrillo. This application and the Average Agreement Plan for payment of demurrage charges both conformed to Freight Tariff 4-K (exhibit 5 in evidence) which was in effect at that time. Item 850 of Tariff 4-K provides that such an agreement becomes effective on the first day of the month following receipt of the application by the railroad.

3. Together with the above-referenced application, Nevins-Petrillo also executed and submitted the written guaranty (exhibit 3 in evidence) wherein it guaranteed to pay to Conrail all demurrage charges which accrued under the terms of the Average Agreement, on any and all of the Conrail cars delivered to the Nevins-Petrillo warehouse or shipped out of said warehouse, without regard to whether such cars or shipments were consigned to Nevins-Petril-lo. The guaranty was was also signed by Jeff Nevins, president of Nevins-Petrillo, and attested to by Carl Petrillo, vice-president and secretary-treasurer of Nevins-Pe-trillo.

4. After receipt of the completed application and guaranty, Conrail granted the request for credit and later billed Nevins-Petrillo for demurrage charges in accordance with the Average Agreement method. Under the Average Agreement Plan, instead of paying demurrage charges on a per-car basis, (straight demurrage), charges for the month are accumulated and credit is given to the customer for cars which are released early. One bill is then rendered at the end of the month for all the net charges accumulated during that month.

5. Prior to the issuance of the monthly demurrage bills for the charges which are the subject of this suit, Nevins-Petrillo had, on several occasions, paid demurrage bills which were rendered under the Average Agreement.

6. Prior to the rail deliveries which form the basis of this lawsuit, Nevins-Pe-trillo submitted a contract bid to the New York City Board of Education, Bureau of Supplies, to provide handling and storage services for rail shipments to the Bureau. A condition of that contract was that de-murrage and related charges would be the responsibility of the contractor. After submission of its bid, Nevins-Petrillo entered into this contract with this agency; a portion of the shipments included in the present action came under this contract.

7. On January 9, 1979, Nevins-Petrillo signed a agreement with Armel regarding payment of demurrage charges, (exhibit 17 in evidence). The agreement provided in relevant part:

“It is agreed and acknowledged between Armel Warehouse Co. and Nevins-Petril-lo Warehouse & Dist. Co. that Armel is not liable for demurrage and detention and all other charges including freight for those [United States Department of Agriculture] cars that have been placed by Conrail at the Harlem River Station and the Nevins-Petrillo siding or any such siding assigned by Nevins-Petrillo. Notification of arrival of cars arrives at Nevins-Petrillo and it is [Nevins Petril-lo’s] responsibility to unload cars for Ar-mel as agreed. This agreement has been in effect since December 12, 1976 ...”

8. After the execution of the aforesaid agreements, and during the years of 1977, 1978 and 1979, Nevins-Petrillo received at its warehouse, from Conrail, incoming railroad cars consigned to various entities but to the “care of” Nevins-Petrillo at its Harlem River/Oak Point facility.

9. Under Item 610 of Freight Tariff 4-K the party responsible for the demur-rage/detention charges, in order to avoid the charges, must unload and release incoming rail cars to the railroad within a certain free time period after the time that notification of the arrival of the car is given by the railroad to that party.

9a. Pursuant to Items 800 et seq. of Tariff 4-K, Conrail prepared and forwarded to Nevins-Petrillo copies of the Monthly Demurrage Audit Statements (MDAS) and the corresponding Statement of Demurrage Charges for certain months of 1977, 1978 and 1979 for which the demurrage charges accrued. See Exhibits 25 through 64 in evidence. The total amount demanded in these statements was $130,410 (which includes a $1,490 correction).

10. Nevins-Petrillo has refused payment of all charges demanded by Conrail.

11. Nevins-Petrillo never requested written notice of the arrival of rail cars.

12. Since Armel did not have a warehouse along the rail-siding at Oak Point, it was required to contract out to Nevins-Pe-trillo to unload cars when they arrived at the Oak Point Yard.

13. By agreeing to unload the cars at Oak Point, Nevins-Petrillo became a “take-care” consignee for all shipments designated to the State of New York.

14. Under its agreement with Armel (exhibit 17 in evidence), Nevins-Petrillo implied that it was liable for demurrage/de-tention and all other charges on United States Department of Agriculture (USDA) cars that had been placed by Conrail at, among other locations, the Conrail Harlem River Station. Transcript at 127-128.

15. During certain months of 1977,1978 and 1979, Nevins-Petrillo failed to unload and release a number of rail cars within the applicable time limits, thereby causing de-murrage charges to accrue under Tariff 4-J or 4-K depending on the date of de-murrage. Freight Tariff 4-J (effective April 1, 1973) in evidence as exhibit 4 and Freight Tariff 4-K (effective July 1, 1977) in evidence as exhibit 5. See also exhibits 25-64 in evidence.

16. In early 1979, the back-up of rail-cars for the account of Nevins-Petrillo increased to such an extent that Conrail, upon the recommendation of the New York City Regional Office of the Interstate Commerce Commission (ICC), imposed an embargo on the Nevins-Petrillo warehouse. Transcript at 33-38, 60. See also October 27, 1982 deposition of Thomas Gariepy, exhibit 1 for identification; January 5, 1983 deposition of Thomas Gariepy at 116.

17. The demurrage charges due Conrail amount to $130,410. See exhibits 25-64 in evidence.

18. The information on each of the Monthly demurrage Audit Statements for Nevins-Petrillo contains, inter alia, car number, contents and the dates and times of arrival, notices of arrival, ordering, placement and release. This information was originally entered directly onto an IBM computer or Demurrage and Industrial Card Control System (DICCS) card. Transcript at 12. A DICCS cars was prepared for every car which arrived at the Harlem River/Oak Point Yard. Transcript at 11-18.

19. The information was entered onto the card by the Conrail Car Control DICCS clerk as each step (arrival, notice, etc.) occurred. After completion of the cards, the information thereon was forwarded to Conrail’s central computer in Philadelphia where the Monthly Demurrage Audit Statement and the Statement of Demurrage Charges were prepared. These statements were sent to Nevins-Petrillo on the fifteenth day of each month. Transcript at 17, 24-28.

20. Each entry of the date and time of notification on the MDAS indicates that telephone notification of the arrival of that car was given to Nevins-Petrillo on that date as permitted under Item 1345 of Tariff 4-K. In addition, if, as a precaution and courtesy, Conrail simultaneously sent to Nevins-Petrillo constructive placement notices, then the time of notification would be indicated as “1700” which is military time for 5:00 p.m. Transcript at 52.

21. In addition to telephone notification and although not required under the Tariff, written constructive placement notices were sent to Nevins-Petrillo for a certain number of the cars. Transcript at 32, 52, 66, 72. See exhibit 67 in evidence consisting of 188 notices of constructive placement. Constructive placement is defined at Item 545 of Freight Tariff 4-K as occurring “when a car consigned or ordered to a private track ... cannot be actually placed because of a condition attributable to the ... consignee____” In such instances, the car may be held at destination and “notice shall be sent or given____” Conrail had an established procedure for mailing notices of constructive placement. Transcript at 68, 72, 161. These notices informed Nevins-Petrillo of the number of the car that Conrail was holding.

22. Nevins-Petrillo did not have a system for noting receipt of notices of constructive placement, and, such notices were discarded when received by Nevins-Petrillo. Transcript at 126.

23. For the nineteen working days during the period from November 13, 1978 through December 8, 1978, 56 railroad cars were released as empty by Nevins-Petrillo, for an unloading average of 3 cars per day. 10/27/82 Gariepy dep., exhibit 1 for identification.

24. During the period from November 13,1978 through December 8,1978, Conrail provided Nevins-Petrillo with two switches per day which would have enabled Nevins-Petrillo to unload six cars per day. 10/27/82 Gariepy dep., exhibit 1 for identification; Transcript at 33.

25. In mid December 1978, fifty-five railcars were awaiting unloading at Conrail’s Oak Point Yard for the account of Nevins-Petrillo with a total number of 666 demurrage days on those cars. 10/27/82 Gariepy dep., exhibit 1 for identification. Transcript at 33-34, 39.

26. On January 10, 1979, Conrail issued an embargo to regulate the number of rail-cars arriving at the Nevins-Petrillo Warehouse. The embargo was designed to reduce the backup of railcars for the account of Nevins-Petrillo. Transcript at 33-34, 39.

27. As of February 16, 1979, thirty rail-ears remained on hand at Conrail’s Oak Point Yard for unloading for the account of Nevins-Petrillo. 10/27/82 Gariepy dep., exhibit 5 for identification.

28. With the exception of one letter which was not offered in evidence at the trial, Nevins-Petrillo never made any written complaints to Conrail regarding allegedly inadequate notice of availability of cars. Transcript at 128-130.

29. Nevins-Petrillo never complained to the ICC’s Thomas Gariepy, during his investigation of the backlog of cars at Oak Point, that Conrail was not affording it proper notification of arrival of cars. December 17, 1982 Gariepy dep. at 51; January 5, 1983 Gariepy dep. at 96.

30. Nevins-Petrillo contends that it did not receive proper notification of arrival of cars “266843” and “31337”. Transcript at 59. These cars are listed on the notice of constructive placement dated February 12, 1979. Nevins-Petrillo was not able to say that it did not receive constructive placement notices for the four to five cars for which notice purportedly was not given. Transcript at 134-135. Although Carl Pe-trillo disputed a particular demurrage bill because notice of arrival was given to Larry at Fiorello (transcript at 110), at that time Fiorello was helping Nevins-Petrillo in the removal of the cars that had accumulated at the Oak Point Yard.

31. The ICC, through Thomas Gariepy, was aware of Conrail’s DICCS computer system. 1/5/83 Gariepy dep. at 114-115.

32. The ICC was familiar with Conrail’s Monthly Demurrage Audit Statement. It was Mr. Gariepy’s opinion that the ICC approved of the monthly audit statements. 1/5/83 Gariepy dep. at 119, 122.

33. Carl Petrillo and Jeff Nevins informed Thomas Gariepy that they would try to “get their act together ...” with respect to clearing up the backlog of cars that had accumulated for their account at Conrail’s Oak Point Yard. 1/5/83 Gariepy dep. at 104.

34. Raymond Olson testified that at no time during the period in question did he or any of the clerks under his supervision at Oak Point receive complaints from any patrons regarding improper notification of arrival of cars. Transcript at 162. During the period involved in this action, Nevins-Petrillo did not complain to Conrail’s Mr. Olson or any of the 20 clerks under his control that it was not getting proper notification of arrival. Transcript at 30-31.

35. If a patron wants written notification of arrival, the patron must make a written request to the railroad. Item 1350 of Tariff 4-K does not prevent the railroad from sending written notice of arrival. In any event, written notice of constructive placement (as opposed to written notice of arrival) is allowed under Item 1305 of the Tariff.

36. During the period in suit, the Conrail clerks at Oak Point were under instructions to notify Nevins-Petrillo when cars arrived for the USDA or Armel. Transcript at 69-70.

37. Pursuant to Item 1345(4) of Tariff 4-K, actual delivery may constitute notice of arrival. Though not a normal practice, Conrail used actual delivery as a form of notice when a patron/consignee had room for delivery. Transcript at 57.

38. During the period in question, the ICC’s Thomas Gariepy was certain that Nevins-Petrillo was aware of the backlog of cars that had accumulated at the Oak Point Yard for its account. 12/17/82 Gar-iepy dep. at 41.

39. Mr. Gariepy believed the reason for the backlog of ears for the account of Nevins-Petrillo was that “too many cars were being shipped too soon by too many people ...” 12/17/82 Gariepy dep. at 44. The purpose of the embargo was to prevent Nevins-Petrillo from receiving more cars at the Oak Point yard than it could handle, thereby securing the prompt release of railroad equipment then in short supply. 12/17/82 Gariepy dep. at 50.

II.

49 U.S.C.A. § 10761(a) (Supp.1982) of the Interstate Commerce Act provides in relevant part:

[A] carrier providing transportation or service subject to the jurisdiction of the Interstate Commerce Commission under chapter 105 of this title shall provide that transportation or service only if the rate for the transportation or service is contained in a tariff that is in effect under this subchapter. That carrier may not charge or receive a different compensation for the transportation or service than the rate specified in the tariff whether by returning a part of that rate to a person, giving a person a privilege, allowing the use of a facility that affects the value of that transportation or service, or another device.

A tariff confers rights and imposes duties as a matter of law. The cases hold that freight charges assessed in accordance with duly filed tariffs have the force of law and must be collected in full. Illinois Central Gulf R. Co. v. Golden Triangle Wholesale Gas Co., 586 F.2d 588, 592 (5th Cir.1978); In re Penn Central Transportation Co., 477 F.2d 841, 844 (3d Cir.), affd sub nom., United States Steel Corp. v. Trustees of Penn Central Transportation Co., 414 U.S. 885, 94 S.Ct. 231, 38 L.Ed.2d 137 (1973).

Demurrage has been defined as “a daily rate charged by a railroad to a consignee (such as defendant) on each railroad car which the consignee fails to unload within a certain time after the car has been either actually or constructively placed by the railroad at the consignee’s disposal for unloading.” Illinois Central Railroad Co. v. Ready-Mix Concrete, Inc., 323 F.Supp. 609, 610 (E.D.La.1971). In City of New Orleans v. Southern Scrap Material Co., 491 F.Supp. 46, 48 (E.D.La.1980), the district court stated:

Demurrage is properly assessed in accordance with the terms of a tariff even though the detention occurs through no fault of the consignee, for a cause that is beyond the consignee’s control____ The assessed party may be relieved of liability only if (1) a specific provision of the tariff exonerates the consignee from liability for demurrage; (2) the delay is the fault of the carrier or those for whom it is responsible; or (3) the delay is casused by a vis major, (citations omitted)

The General Car Demurrage Tariffs (Freight Tariffs 4-J, 4-K and the relevant supplements) which applied to the various shipments involved in this action set forth the rules which govern the relationship between the carrier and the consignee (or any other person responsible for the demurrage charges). Item 610 of Freight Tariff 4-K provides that “[f]ree time will be computed from the first 7:00 a.m. after placement or after proper notification has been sent or given where required.” Item 1345 of Tariff 4-K provides methods and procedures for notification. “Notification may be sent or given: (1) In writing by U.S. Mail or otherwise. (2) By personal or telephone communication. (3) By action of the consignee (see item 1360). (4) By delivery of cars upon other than public delivery tracks or industrial interchange tracks serving consignee or consignor.” See Exhibit 5.

At the trial, Conrail demonstrated that each railcar upon which the demurrage charges accrued was properly placed (either actual placement or constructive placement), and that proper notice of arrival was given to Nevins-Petrillo for each car. Notice was given by telephone and, in many instances, by both telephone and writing. Records of the telephone notice were made at the time notice was given and the information reflected in these records was forwarded to Conrail’s central computer in Philadelphia where the monthly demurrage audit statement and the statement of de-murrage charges were automatically prepared and sent to Nevins-Petrillo on the fifteenth day of each month. Under Conrail’s recordkeeping procedures, no handwritten records are available for the de-murrage charges sought in this lawsuit. The “DICCS” cards upon which the relevant information was entered no longer exist. Conrail produced at trial the computer printouts which contain the pertinent information for computation of demurrage (notice, placement, and release dates). It showed that such information was reliably entered into the computer system from the original field documents.

The general rule is that a consignee is not responsible for demurrage “where the delay is the fault of the carrier or those for whom he is responsible____” See Pennsylvania Railroad Co. v. Moore-McCormack Lines, Inc., 370 F.2d 430, 432 (2d Cir.1966). Here, it was Nevins-Petril-lo’s failure to timely unload and release the railcars which led to the accrual of the demurrage charges and imposition of the embargo upon its warehouse. The contention by Nevins-Petrillo that the delay was the fault of Conrail is without merit.

The demurrage charges demanded by Conrail were assessed in accordance with duly filed tariffs and, accordingly, should be collected in full. Conrail documented its claim for the unpaid demurrage charges. With the exception of the names of the persons giving and receiving notification, Conrail’s monthly demurrage audit statements contain the information prescribed by the Interstate Commerce Commission’s record-keeping regulations, 49 C.F.R. Part 1254. These regulations were repealed by the ICC on December 20, 1982. (“The Commission has determined that the rules at 49 C.F.R. 1254, pertaining to the maintenance of demurrage and detention records, are unnecessary. The Commission is removing these rules. The removal ... will be effective on January 31, 1983.”) (See ICC Ex Parte No. 285).

Further, Conrail produced 188 copies of written notices of constructive placement and testimony on the procedures for mailing these notices. (Exhibit 67 in evidence).

Carl Petrillo testified that Nevins-Petrillo received notice from Conrail of the availability of cars generally by telephone call or by actual placement of the car. Transcript at 96. He stated he learned in January 1979 that a substantial number of cars consigned to Nevins-Petrillo’s order were in Conrail’s yard. He then made arrangements to place the cars with Fiorello warehouse. 20 to 30 cars were in fact placed with Fiorello. Petrillo testified that he did not receive telephone notice or constructive placement notice of the availability of the cars placed with Fiorello. He also testified that he didn’t receive notice with respect to 81 of Armel’s cars. The only notice he claims he received on the 81 Armel ears was the actual placement of the cars. Transcript at 97-102. Referring to exhibits 59 and 60, Petrillo cited several instances where Conrail purportedly failed to provide notification to Nevins-Petrillo. Transcript 106-117.

Mr. Petrillo’s testimony was somewhat incredible in light of the fact that at page 135 of the transcript he testified that his company maintained records of the telephone notification it received from Conrail. He said that these records presently exist but were not supplied to Conrail. The records were not produced during discovery or at the trial. Transcript 135-140.

Where a party fails to produce material evidence in its control, the court may infer that the evidence is unfavorable to that party. The inference can be rebutted by an adequate explanation for non-production. Tupman Thurlow Co., Inc. v. S.S. Cap Castillo, 490 F.2d 302, 308 (2d Cir. 1974). Although asked during pretrial discovery to produce any business records evidencing the dates of arrival, notification, etc. of the cars which are the subject of this action, Carl Petrillo stated for the first time at trial that such records existed, had not been furnished to Conrail and were still at the Nevins-Petrillo warehouse. (Transcript at 139,146-147). The trial testimony of Carl Petrillo concerning the existence of these documents flatly contradicted his deposition testimony. The failure to produce these documents leads the court to infer that the documents are unfavorable to Nevins-Petrillo. There was no satisfactory explanation for their non-production.

The documentary evidence, the testimony of Raymond Olson, and the pertinent portions of the deposition of Thomas Gariepy refute Mr. Petrillo’s assertion of lack of notice to Nevins-Petrillo of availability of cars.

With respect to the counterclaims asserted against Conrail by Nevins-Petrillo, no proof was offered at trial by Nevins-Petril-lo of any damages. The counterclaims are dismissed for failure of proof. As noted earlier, the inability of Nevins-Petrillo to unload and release the railcars which came into its warehouse within the time limits established under the tariff led to the backup of cars and the ensuing embargo.

Nevins-Petrillo has argued that it did not receive the required arrival notice for the railcars. However, with the exception of this argument, which the court has rejected, Nevins-Petrillo has not contested, either at trial or in its proposed findings, the calculation of the demurrage charges by Conrail. Nevins-Petrillo does not argue that the amounts arrived at by Conrail through the use of Conrail’s notice, placement and release dates are incorrect. Conrail is due $130,410 in demurrage charges.

The court finds that Conrail has not sustained its burden of proof with respect to the Rule 725 and Rule 61 charges. Conrail failed to adequately demonstrate the purpose, nature and application of these charges. The evidence submitted in support of these charges is unclear and ambiguous and there is not sufficient information for the court to make a finding. Accordingly, Rule 725 and Rule 61 charges are not awarded.

In accordance with the above, Conrail is awarded demurrage charges in the amount of $130,410. Conrail is directed to submit a judgment on notice within 15 days after entry of this decision.

SO ORDERED.

      . Findings of fact 1 through 13 closely follow the agreed facts set forth in the pretrial order.

      . 49 C.F.R. § 1254.03(d) provides as follows: "Notification of arrival, actual placement, or constructive placement. Notification of arrival, actual placement, or constructive placement shall be given in writing by the carrier to the shipper or consignee with a copy thereof retained by the carrier. If by tariff exception a carrier provides for telephone notification of arrival, actual placement, or constructive placement of cars instead of written notification, the carrier shall maintain a record of the said telephone notification which shall include the following information: (1) Name of the carrier’s employee giving such notification; (2) Name of the shipper of consignee receiving such notification; (3) Name of the shipper’s or consignee’s employee receiving the notification; (4) Car initial and number; (5) Date and time notification ¡s ¡ven the shipper or consignee.”

      . Rule 725 charges apparently are special charges for mechanical refrigeration railcars. Conrail seeks Rule 725 charges in the amount of $33,142.44. However, disputed exhibit 77 listed in the pretrial order rule was not received in evidence. This exhibit specifies $4,934.99 in Rule 725 charges.

      . See note 4 on page 907.

        4. Rule 61 charges apparently are some type of special detention charge assessed in connection with shipments shipped at a lower than normal freight rate.


source: Caselaw Access Project

license: Public Domain

text:
    THIRD NATIONAL BANK IN NASHVILLE, Plaintiff, v. SHEARSON EQUIPMENT MANAGEMENT CORPORATION, Defendant.
    Civ. A. No. 3:84-0500.
    United States District Court, M.D. Tennessee, Nashville Division.
    May 21, 1984.
    On Motions to Dismiss or for Change of Venue March 18, 1985.

      Tom Kanaday, Farris, Warfield & Kana-day, Nashville, Tenn., for plaintiff.
    Steven A. Riley, Bass, Berry & Sims, Nashville, Tenn., for defendant.
   MEMORANDUM OPINION

NEESE, Senior District Judge, Sitting by Designation and Assignment.

The Court notices sua sponte, as it must, Stokes v. Merrill Lynch, Pierce, Feener & Smith, 523 F.2d 433, 437 (6th Cir.1975), that the removal-petition herein is deficient, in that it alleges no facts showing that, at the time this action was commenced in the state Court, the plaintiff and defendant were not citizens of the same state. It is elementary that, where, as here, a defendant seeks to remove a case from a state court to a federal court on the grounds of diversity of citizenship and the matter in controversy, allegations in the removal-petition of sufficient facts are required to demonstrate that, both when the action was commenced in the state Court and when the removal-petition was filed, no plaintiff and no defendant was a citizen of the same state, Wenger v. Western Reserve Life Assur. Co. of Ohio, 570 F.Supp. 8, 10[3] (D.C.Tenn.1983), and cases gathered therein; this has been the rule for more than a century. See Gibson v. Bruce, 108 U.S. 561, 563, 2 S.Ct. 873, 875, 27 L.Ed. 825 (1883).

The Court does not enter an order of remand at this time, because it appears that the defendant might be able to amend its removal-petition so as to supply the missing allegations within the mandatory 30-day period for so doing. See Wenger v. Western Reserve Life Assur. Co. of Ohio, supra, and eases cited therein. The Court holds this matter in abeyance briefly to allow the defendant time in which to attempt to amend its petition for removal in timely fashion if same can be done.

ON MOTIONS TO DISMISS OR FOR CHANGE OF VENUE

This is a removed, 28 U.S.C. § 1441(a), diversity, 28 U.S.C. §§ 1332(a)(1), (c), action for breach of contract. The defendant, Shearson Equipment Management Corporation (Shearson), moved inter alia for a dismissal on the ground that this District Court lacks jurisdiction of its corporate-person, Rule 12(b)(2), F.R.Civ.P., because, subjecting it to a judgment in personam in its absence from territory of the state of Tennessee without certain minimum contacts therewith, offends “ * * * ‘traditional notions of fair play and substantial justice’ * * * in violation of its right to due process of law.” Cf. International Shoe Co. v. State of Washington, etc., 326 U.S. 310, 316, 66 S.Ct. 154,158[3], 90 L.Ed. 95 (1945).

Three criteria for determining the outer limits of the in-personam jurisdiction of this Court are postulated in this Circuit, as follows:

“First, the defendant must purposefully avail [itjself of the privilege of acting in the forum state or causing a consequence in the forum state. Second, the cause of action must arise from the defendant’s activities there. Finally, the acts of the defendant or consequences caused by the defendant must have a substantial enough connection with the forum state to make the exercise of jurisdiction over the defendant reasonable. * * * ))

Southern Machine Company v. Mohasco Industries, Inc., 401 F.2d 374, 381[5] (6th Cir.1968) (stating the rule with respect to a single contact). The plaintiff Third National Bank in Nashville (Bank) bears the burden of proving that this Court has jurisdiction of Shearson’s corporate person. Capital Dredge & Dock Corp. v. Midwest Dredging Co., 573 F.2d 377, 378[1].

Service of process on the defendant was by means of the “long-arm statute” of Tennessee, T.C.A. § 20-2-201. It has been determined “ * * * that it was the intention of the Tennessee legislature in enacting T. C.A. 20-235 [now, 20-2-201] to comprehend ‘the full jurisdiction allowable under the [Constitution,] Fourteenth Amendment.’ * * * ” Pickens v. Hess, 573 F.2d 380, 385[5] (6th Cir.1978). “ * * * ‘Whether due process is satisfied must depend * * * upon the quality and nature of the activity [of the defendant: (as in orig.) ] in relation to the fair and orderly administration of the laws which it was the purpose of the due process clause to insure. That clause does not contemplate that a state may make binding a judgment in personam against an individual or corporate defendant with which the state has no contacts, ties, or relations.’ * * * ” Id., 573 F.2d at 385, quoting from International Shoe Co. v. State of Washington, etc., supra. 326 U. S. at 319, 66 S.Ct. at 160.

The Bank established by affidavits these facts: i

'Shearson is a Delaware corporation with its principal place of business in New York. Its personnel solicited personnel of the Bank as to the identity of an attractive tax shelter, and personnel of the Bank suggested the purchase of river barges for this purpose.

The managing partner in each, Shearson, then formed a group of limited partnerships to make such purchases. Thereafter, its president, Mr. James Carthaus, discussed in Nashville with personnel of the Bank the establishment of a fiscal relationship between additional limited partnerships and the Bank. He returned to Nashville after some six months had elapsed and solidified his acquaintence with the personnel of the Bank.

The Bank provided the financing for a second group, consisting of four such partnerships. Approximately a year after this second group of partnerships was financed by the Bank, there was contact between respective personnel of Shearson and the Bank by means of mail- and telephonic-communication relative to the Bank’s financing of three additional limited partnerships. The latter loans were closed in St. Louis, Missouri in 1981, the partnership designated as Shearson VIII being closed March 31, the partnership known as Shear-son IX being closed June 12, and the partnership known as Shearson X being closed August 4.

Each of the Bank’s respective loans to each such limited partnership was substantially the same, with Shearson guaranteeing each such partnership’s loan from the Bank. Each such guaranty included the following language:

“This instrument is executed in New York, New York, and delivered in St. Louis, Missouri, as an incident to the lending transaction consumated in St. Louis, Missouri, and is to be construed according to the laws of the State of New York. Notwithstanding the foregoing, guarantor hereby consents to the personal jurisdiction of any state or federal court which would have personal jurisdiction of the guarantor if it were domiciled in or doing business at debtor’s principal place of business in St. Louis, Missouri, including without limitation, the United States District Court for the Eastern District of Missouri and the Circuit Court for the City St. Louis, with respect to any claim of liability to lender arising under or pursuant to this guarantee.”

Shearson VIII, Shearson IX, and Shear-son X encountered fiscal difficulties in 1982, and the terms of loans by the Bank to those partnerships were renegotiated by mail; however, such financial problems persisted, and the aforenamed Mr. Car-thaus returned to Nashville in December, 1983 and had further negotiations with the Bank. When these proved unsuccessful, the Bank made demand upon Shearson as guarantor on each of the aforementioned partnership loans. This action was commenced April 4, 1984.

The foregoing facts demonstrate with clarity that the guarantor Shearson availed itself of the privilege of conducting and guaranteeing the financing transactions of the said third group of limited partnerships with the Bank operating in Tennessee; its “coming into” this state for this purpose and guaranteeing the aforesaid loans from the Bank operating in this state “ * * * may fairly be said to have had at least ‘minimum contact’ with such state so that maintenance of a suit [ ] herein based upon such transaction^] [does] not constitute a denial of due process of law. * * * ” Hamilton National Bank of Chattanooga v. Russell, 261 F.Supp. 145, 150[9] (D.C. Tenn.1966). “ * * * [T]hat a defendant did not perform a physical act within the State of Tennessee is not determinative of his or her [or its] lack of ‘minimum contact,’ for activities outside the state resulting in consequences within the state may subject those involved in such activities to in personam jurisdiction of the courts of the state. Young v. Masci, supra [289 U.S. 253, 53 S.Ct. 599, 77 L.Ed. 1158 (1933)]; Velandra v. Regis Nationale Des Usines Renault, (C.A.6, 1964) 336 F.2d 292. * * ” Id., 261 at 149[8], cited and quoted from in Third Nat. Bk., Nashville v. Hardi-Gardens Sup. of Ill., Inc., 380 F.Supp. 930, 936-937 (D.C.Tenn.1974) (“The mere fact that a note was signed or guaranteed outside of the State of Tennessee does not, of itself, denude this Court from exercising its constitutional powers over the * * * guarantor.”)

The fact that some of the transactions of the parties were carried on by mail and telephone between them in Tennessee and New York does not change the result. See Nicholstone Book, etc. v. Chelsea House Pub., 621 S.W.2d 560 (Tenn.1981). The further fact that any tortious action of the defendant, allegedly causing proximately damage to the Bank within Tennessee, was committed outside of Tennessee, does not prevent the Bank from reaching the purported tort-feasor under the “long-arm statute” of Tennessee. T.C.A. § 20-2-201, supra; cf. Jasper Aviation, Inc. v. McCollum Aviation, Inc., 497 S.W.2d 240 (Tenn. 1972).

The motion of the defendant for a dismissal of this action for lack of personal jurisdiction over it, therefore, hereby is

DENIED.

The alternative motion of the defendant for a change of the venue hereof, 28 U.S.C. § 1404(a), to the Eastern District of Missouri, also lacks merit. It is represented to the Court by the Bank that all its witnesses are here; and it is represented to the Court by Shearson that the Bank has actions pending against other guarantors in the District Court for the Eastern District of Missouri, Eastern Division, and that all those cases and this case should be tried there simultaneously.

The purport of the defendant’s motion in this regard appears to be its effort to shift any inconvenience from it to the Bank; such a motion should not be granted, see Van Dusen v. Barrack, 376 U.S. 612, 633, 84 S.Ct. 805, 818[14], 11 L.Ed.2d 945 (1964). The balance of factors appearing to be somewhat even, the Bank’s choice of a forum will not be disturbed. Cf. Crawford v. United States, 188 F.2d 536 (6th Cir.1951).

The motion for a change of venue, accordingly, hereby is

DENIED.

       " * * * It is also true that when a record presented to this court fails to show a diversity of citizenship, both when the suit was commenced and when the petition for removal was filed, a reversal has been ordered and the case sent back to the circuit court, with directions to remand to the state court.” Kinney v. Columbia Savings & Loan Assoc., 191 U.S. 78, 81, 24 S.Ct. 30, 32, 48 L.Ed.2d 103 (1903).

      . It is observed that such instrument states facially that it is “ * * * an incident to the [pertinent] lending transaction * *

        . Shearson made no showing that the three Missouri cases at issue have been consolidated for trial.


author: DAVID S. NELSON, District Judge.

text:
    Charles T. DIRRING, Plaintiff, v. LOMBARD BROTHERS, INC., et al., Defendants.
    Civ. A. No. 80-781-N.
    United States District Court, D. Massachusetts.
    July 18, 1984.

      Paul A. Manoff, Levine & Manoff, and Peter Rosenthal, Boston, Mass., for plaintiff.
    Marshall Newman, Samuel Newman, Newman & Newman P.C., Boston, Mass.,, for Lombard Bros.
   MEMORANDUM AND ORDER

DAVID S. NELSON, District Judge.

This is an action brought by Charles Dir-ring against his former employer, Lombard Brothers, Inc., pursuant to § 301 of the Labor Management Relations Act, 29 U.S.C. § 185. The plaintiff claims in his amended complaint that he was discharged by the defendant in violation of a collective bargaining agreement.

Dirring was employed by Lombard as a truckdriver from approximately 1968 until January 1980. During this period, Dirring was a member of Local 25, International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America (the “Union”). In 1979, Lombard and the Union, as collective bargaining representative, entered into a collective bargaining agreement. This agreement governed the employment relationship between Lombard and Dirring.

The plaintiff filed this action on April 23, 1980. His complaint, as amended, is in two counts. Count I alleges that the Union breached its duty of fair representation because (1) the Union agent who represented plaintiff informed him that there was no need to have plaintiff’s lawyer present at the arbitration hearing, (2) the Union agent failed to disclose a conflict of interest which existed because a relative of his became employed by Lombard prior to the hearing, and (3) the Union ágent failed to cite relevant portions of the collective bargaining agreement during the proceedings before the arbitrator. Count II invokes the provisions of the National Arbitration Act, 9 U.S.C. § 10, and claims that the arbitrator exceeded his authority in making the award because his decision “did not draw its essence from the agreement.” Amended Complaint at H 27.

Both parties have filed cross-motions for summary judgment. In this Circuit, matters are appropriate for summary judgment when the record reveals no disputed issue of fact which is both genuine and material. Hahn v. Sargent, 523 F.2d 461, 464 (1st Cir.1975), cert. denied, 425 U.S. 904, 96 S.Ct. 1495, 47 L.Ed.2d 754 (1976). After careful review of the record, I am obliged to enter judgment on behalf of the defendant Lombard on both counts.

The parties’ submissions disclose the following undisputed facts. On or about January 10, 1980, the plaintiff was involved in a fight with one Arthur Mahoney, another truckdriver employed by Lombard. On January 15, 1980, the plaintiff was formally notified by his superior, Melbourne Crouse, that he had been discharged as a result of the fight. Mahoney was also discharged.

In addition to the collective bargaining agreement in effect at the time of plaintiff’s discharge, Lombard employees were subject to a so-called “Book of Rules.” As set forth therein, the purpose of the book was “to acquaint you (the employee) with your duties and responsibilities as professional drivers and freight handlers. It is designed to serve as a guide in your relations with the company and the shipping public.” Biron Affidavit, Ex. B-2 at 1. General Rule 4 strictly forbade “fighting on company time or property.” Id. at 2. There is no question that the plaintiff was aware of this Rule.

Nor is there any question that discharges based upon improper conduct under the Book of Rules are subject to the provisions of the collective bargaining agreement. Article 47 of the agreement provides in pertinent part that:

The employer shall not discharge nor suspend any employee without just cause, but in respect to discharge or suspension shall give at least (1) warning notice of the complaint against such employee to the employee, in writing ... except that no warning notice need be given to an employee before he is discharged if the cause of such discharge is dishonesty or drunkeness, or recklessness resulting in serious accident while on duty, or the carrying of unauthorized passengers. The warning notice as herein provided shall not remain in effect for a period of more than nine (9) months from the date of said warning notice ...

The agreement also contains a formal grievance procedure, culminating in binding arbitration, which may be utilized by an employee who wishes to protest his discharge."

Upon receiving their termination notices, plaintiff and Mahoney filed grievances. They were both represented throughout the proceedings, by Alfred Singelais, the Union’s business agent. In accordance with the collective bargaining agreement, when Singelais’ initial attempts to resolve the grievances failed, the Union pursued arbitration. Singelais also represented both men at their arbitration hearings. The hearings were held on the same day in March 1980, before the same arbitrator.

Prior to the hearing, the parties' agree, Dirring requested that his privately retained counsel be allowed to participate in the proceedings. Singelais told him that the attorney could attend the hearing only as an observer and not as a participant. When Dirring explained this to his attorney, the attorney decided not to attend. It seems that Singelais’ response to the plaintiff’s request reflected relevant contractual language. The Rules of Procedure on Grievances state that “[ajrguments on the facts or merits of the case shall only be argued by a full time representative of the employer or the Union____ Attorney’s [sic] will not be permitted to argue the merits on any case before the Joint Area Committee whether it be a discharge or a grievance.” Biron Affidavit, Ex. 13-3, at Article V, § 1. While the plaintiff does not contest the Union’s authority under this provision, he does challenge the application of the Rule to arbitration hearings. Moreover, he claims, Singelais never explained why the attorney’s presence would not be necessary.

The thrust of the arbitrator’s inquiry was whether there was “just cause” for the termination. Dirring made a statement and Singelais, in addition to cross-examining Lombard’s witnesses, argued on Dir-ring’s behalf. Each urged that although fighting on company time and property was strictly prohibited, Dirring was only defending himself and that given his ten years of service, discharge was too harsh a remedy.

The hearing transcript indicates, and the parties agree, that no specific provisions of the collective bargaining agreement were ever mentioned or formally entered into evidence. It is also apparent that no one at the hearing, including the plaintiff and his representative, questioned Lombard’s failure to send Dirring a warning notice within the nine-month period preceding the discharge.

Something else happened in that time period, however. Lombard employed one Norman McVicar as a truckdriver. McVi-car was Singelais’ brother-in-law. The plaintiff does not dispute that he was aware of this relationship at the time McVi-car was hired, and more important, at the time he approached Singelais about representing him. Dirring Deposition, at 10-14. Nor does the plaintiff dispute the fact that hé never expressed any concern about a potential conflict, either to Singelais, to the arbitrator, or to anyone else. At his deposition Dirring gave the following response:

Q: Did you see anything wrong with the fact that Singelais was representing your case at the Grievance Board while being related to McVi-car who was working for Lombard?
A: I don’t know. It never crossed my mind one way or the other.

Dirring Deposition, at 14.

The combination of the foregoing facts, according to plaintiff, demonstrates that the Union breached its duty of fair representation, and in doing so, undermined the integrity of the arbitral process so that the arbitrator’s award did not derive its essence from the collective bargaining agreement.

Duty of Fair Representation

As a preliminary matter, the defendant has moved for summary judgment on the basis that plaintiff’s action is time-barred. Unfortunately, defendant’s argument is based solely upon the Supreme Court’s decision in United Parcel Service, Inc. v. Mitchell, 451 U.S. 56,101 S.Ct. 1559, 67 L.Ed.2d 732 (1981). In Mitchell the Court held that since Congress had not enacted a limitations period with reference to actions brought under § 301, the timeliness of a § 301 suit “is to be determined as a matter of federal law by reference to the appropriate state statute of limitations.” Id. at 60, 101 S.Ct. at 1562, quoting, Johnson v. Railway Express Agency, 421 U.S. 454, 462, 95 S.Ct. 1716, 1721, 44 L.Ed.2d 295 (1975).

The Court re-evaluated its Mitchell decision in DelCostello v. Intl. Brotherhood of Teamsters, 462 U.S. 151, 103 S.Ct. 2281, 76 L.Ed.2d 476 (1983). DelCostello held that the applicable statute of limitations in a case such as this, brought under § 301, is the six-month period prescribed in § 10(b) of the Labor Management Relations Act, 29 U.S.C. § 160(b). Recently, the First Circuit Court of Appeals ruled that DelCostello should be applied retroactively. Graves v. Smith’s Transfer Corp., 736 F.2d 819 (1st Cir.1984).

Inasmuch as Dirring received a copy of the arbitration award on March 17, 1980, and commenced this action against the employer, on April 23, 1980, he came well within the six-month limitations period. Thus, this action is not time-barred.

Lombard also argues that it is entitled to summary judgment because the plaintiff has failed to state a cause of action against the Union for breach of the duty of fair representation. Lombard is correct in articulating the standard which this Circuit has adopted in testing allegations of breach:

To have a right to contest the merits of their discharge in court, [employees] must first show that the union violated its duty of fair representation; otherwise the decision of the [arbitrator] is “final and binding.” Hines v. Anchor Motor Freight, Inc., 424 U.S. 554, 96 S.Ct. 1048, 47 L.Ed.2d 231 (1976). This exception to the finality rule is narrow. Sear v. Cadillac Automobile Co. of Boston, 654 F.2d 4, 7 (1st Cir.1981). “A breach of the statutory duty of fair representation occurs only when a union’s conduct toward a member of the collective bargaining unit is arbitrary, discriminatory, or in bad faith.” Vaca v. Sipes, 386 U.S. 171, 190, 87 S.Ct. 903, 916, 17 L.Ed.2d 842 (1967). “A union may not arbitrarily ignore a meritorious grievance or process it in a perfunctory fashion.” Id. at 191, 87 S.Ct. at 917. However, the fact that the grievance was meritorious does not establish a breach of duty of fair representation or entitle the grievant to escape the bar of finality imposed by the collective bargaining agreement, for “[t]he grievance process cannot be expected to be error-free.” Hines v. Anchor Motor Freight, Inc., 424 U.S. at 571, 96 S.Ct. at 1059. There must be a separate showing of a union breach that “seriously undermined the integrity of the arbitral process.” Id. at 567, 96 S.Ct. at 1058. Mere negligence of the union does not amount to such a breach. Con-don v. Local 2944, United Steelworkers of America, 683 F.2d 590, 594-95 (1st Cir.1982).

Early v. Eastern Transfer, 699 F.2d 552, 555 (1st Cir.) (footnote omitted), cert. denied, 464 U.S. 824, 104 S.Ct. 93, 78 L.Ed.2d 100 (1983). Viewing the materials submitted by the parties in the light most favorable to the employee, I believe that he has failed to “make a sufficient showing that the union’s treatment of [his grievance] lay outside ‘the range of acceptable performance by a collective bargaining agent.’ ” Id., quoting Hines, 424 U.S. at 568, 96 S.Ct. at 1058.

The plaintiff’s first contention is that his attorney should have been allowed to participate in the hearing, the Rules of Procedure on Grievances notwithstanding. Those rules, plaintiff argues, apply only to hearings before the Joint Area Committee, and not to the arbitration phase of the grievance proceedings. Thus posed, Dir-ring’s argument presents a question of contract interpretation which is beyond the province of this Court to decide. See United Steelworkers v. Enterprise Wheel & Car Corp., 363 U.S. 593, 80 S.Ct. 1358, 4 L.Ed.2d 1424 (1960). Apart from the applicability of the Rule, however, there remains the more general question of whether counsel’s presence and participation are required in order for the Union to satisfy its duty of fair representation. Courts have not generally so held.

For example, the Fourth Circuit has stated that “[a]n arbitration hearing is not a court of law and need not be conducted like one. Neither lawyers nor strict adherence to judicial rules of evidence are necessary complements of industrial peace and stability — the ultimate goals of arbitration.” Walden v. Local 71, International Brotherhood of Teamsters, 468 F.2d 196 (4th Cir.1972). Similarly, the Fifth Circuit has held that the fact that a union does not provide a grievant with a lawyer will not support a claim against the union. Grov-ner v. Georgia-Pacific Corp., 625 F.2d 1289 (5th Cir.1980). Accord, Castelli v. Douglas Aircraft Co., 752 F.2d 1480, 1483 (9th Cir.1985).

The Supreme Court has also spoken, albeit indirectly, to the involvement of counsel in the grievance process. In Hines, the union told the complaining employees that they need not have counsel because the union would process their grievance. However, at the arbitration hearing the union representative presented no evidence in favor of the grievants, and the arbitrators ruled against them. After arbitration, the grievants retained their own counsel who uncovered evidence which exonerated them of the charges upon which their discharges had been based.

The Court’s focus in Hines was upon the employees’ representation, the lack of which seriously undermined the arbitral process. In the instant case, I am not convinced that the Union’s representation was, in effect, no representation at all. Singelais was an experienced union business agent who had handled “thousands” of grievances in the past. Singelais Affidavit, at U 4. He cross-examined Lombard’s witnesses, urged the arbitrator to disregard evidence of former disciplinary action taken against Dirring, and argued very strongly in favor of reinstating the plaintiff. It is doubtful whether private counsel’s making these arguments, or his presence at the hearing would have enhanced the integrity of the proceeding.

The plaintiff argues, however, that private counsel would have raised the fact that Lombard issued no warnings within the nine months prior to the discharge. Singelais’ failure to raise this point is plaintiff’s second basis for claiming a breach of the Union’s duty.

This argument assumes that the discharge for fighting on company time and on company property required a warning and was not within the scope of discharges based upon “recklessness resulting in serious accident while on duty,” which do not require warnings. Dirring’s interpretation of the collective bargaining agreement is that the term “recklessness” as used therein refers to certain misconduct while driving. It is the only reasonable interpretation, he contends, since Lombard is a trucking company and most of its employees are drivers.

Lombard, on the other hand, argues that the term “recklessness” is broad enough to encompass fighting. The Union representative, Singelais, took the same view of the collective bargaining agreement; that is, that fighting constituted recklessness. Therefore, he considered it unnecessary to raise the notice requirement. Singelais Affidavit, at 1119.

The First Circuit has held that a union does not have to share an employee’s interpretation of the collective bargaining agreement, and consequently, does not breach its duty when it fails to make arguments based thereon. Early v. Eastern Transfer, 699 F.2d at 557. Thus Singelais was “entitled to decline to put forward an interpretation which he and his union reasonably believed was incorrect,” id., citing Findley v. Jones Motor Freight, Inc., 639 F.2d 953, 960 (3d Cir.1981) and Cannon v. Consolidated Freightways Corp., 524 F.2d 290, 294 (7th Cir.1975), especially when Dir-ring himself could have raised the argument when he made a statement to the arbitrator.

At most, Singelais’ failure to raise the warning requirement amounted to mere negligence or a mistake in judgment for which the Union cannot be held liable. Findley v. Jones Motor Freight, Inc., 639 F.2d at 960. Apart from what was arguably negligence, the Union’s approach to the case was careful and adequate under the circumstances. Singelais made a full investigation, pursued the preliminary steps in the grievance process, gave Dir-ring notice and the opportunity to participate, mustered colorable arguments, and refuted insubstantial and irrelevant arguments by the employer.

Given such handling of the grievance, I also find that the plaintiffs third basis for claiming a breach of the Union’s duty, namely the conflict of interest, lacks merit. While it is true that a union may not be held liable for mere negligence or errors in judgment, it may be guilty of breach if bias or hostility influence its handling of the grievance. Early v. Eastern Transfer, 699 F.2d at 555-56. In this case, of course, Dirring alleges that Singelais was biased in favor of the employer, and consequently, refused his requests for a lawyer and refused to mention the notice requirement.

As indicated above, I do not find that Singelais’ refusal in regard to these matters was arbitrary, nor do I think the evidence warrants a conclusion that he was motivated by bad faith or hostility toward the plaintiff. For instance, it is undisputed that there was never any hostility between Singelais and Dirring. In fact, Singelais had successfully represented Dirring in previous disputes with the employer. In addition, the plaintiff does not deny that when Singelais offered to withdraw from the case, he asked the union official to continue his representation:

At around this time [prior to the convening of the Joint Area Committee], I heard “through the grapevine” that Dirring was not pleased with my representation at the informal meeting with Lombard’s representatives. Accordingly, I contacted Dirring, informed him that there were six other business agents who were available to represent him and inquired whether he wished someone else to represent him before the Joint Area Committee. Dirring told me that he wished to be represented by me.

Singelais Affidavit, at 1112.

Dirring’s contention here is further weakened by his failure to have raised the issue of Singelais’ alleged conflict before either the Joint Committee or the arbitrator. At both hearings, the plaintiff was given the opportunity to speak on his own behalf. All the facts now argued as to Singelais’ alleged bias were known to the plaintiff at the time the Joint Committee and the arbitrator heard his grievance. Yet, he failed to call the decisionmakers’ attention to those facts.

The First Circuit has agreed with the generally accepted rule of arbitration that only in exceptional circumstances will a claim of personal bias or conflict of interest be entertained where it could have been raised at the hearing to which it applies. Early v. Eastern Transfer, 699 F.2d at 558, citing Amalgamated Meat Cutters v. Cross Brothers Meat Packers, Inc., 518 F.2d 1113, 1121 & n. 19 (3d Cir.1975); Morris v. Werner-Continental, Inc., 466 F.2d 1185, 1189 (6th Cir.1972), cert, denied, 411 U.S. 965, 93 S.Ct. 2144, 36 L.Ed.2d 685 (1973); Cook Industries, Inc., v. C. Itoh & Co., 449 F.2d 106, 107-08 (2d Cir.1971), cert, denied, 405 U.S. 921, 92 S.Ct. 957, 30 L.Ed.2d 792 (1972); Graphic Arts International Union v. Haddon Craftsmen, Inc., 489 F.Supp. 1088, 1093 (M.D.Pa.1979); United Steelworkers of America Local 1913 v. Union Railroad Co., 648 F.2d 905 (3d Cir.1981). The present case does not fall within the category of exceptional cases. Thus, plaintiff’s claim that the Union breached its duty of fair representation must fail on all grounds.

Arbitrator’s Decision

Count II of the complaint alleges that even if the Union did not breach its duty of fair representation, the arbitrator’s award should be set aside because it does not draw its essence from the collective bargaining agreement. Specifically, Dir-ring argues that the arbitrator failed to take into account, or indicate that he was taking notice of, the express language in the agreement requiring written warnings prior to discharge.

In reviewing this claim, I am limited by the Supreme Court’s holding in United Steelworkers v. Enterprise Wheel & Car Corp., 363 U.S. 593, 80 S.Ct. 1358, 4 L.Ed.2d 1424 (1960), which was that the parties having bargained for the decision of the arbitrator on the merits, and the arbitrator having expertise concerning plant practices, a federal court must not set aside an arbitral award merely because it disagrees with the arbitrator on the merits. Nevertheless, the Court was compelled to sketch out the limits of judicial deference:

(A)n 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.

Id. at 597, 80 S.Ct. at 1361.

In short, it is my task to determine whether the arbitrator has resolved the grievance by considering the proper sources, but not to determine whether he has resolved the grievance correctly.

The issue before the arbitrator was whether there was just cause for the discharge. According to the plaintiff, the arbitrator obviously failed to consider the collective bargaining agreement, the notice requirement in particular, because the award neither cites nor purports to interpret any provision of the agreement. This argument, however, is insufficient to set aside the arbitrator’s decision.

The arbitrator had before him the “just cause” requirement which is established by the collective bargaining agreement. The provision which establishes that requirement further limits Lombard’s ability to discharge by subjecting the employer to a notice requirement. In view of the sharp factual dispute over who started the fight which resulted in Dirring’s discharge, whether self-defense was an exception to Lombard’s rule against fighting, and whether fighting constituted recklessness, the arbitrator could not have decided the “just cause” question without also, albeit implicitly, deciding the notice question. In so deciding, it was entirely proper for him to interpret the collective bargaining agreement such that fighting fell within the definition of “recklessness,” and therefore, was conduct for which no notice was required. See Walden v. Local 71, 468 F.2d at 197.

Dirring argues that even if the foregoing constituted the arbitrator’s approach to the grievance, the award should be set aside because it does spell out the arbitrator’s rationale or sources of decision. Unfortunately, the plaintiff’s argument incorrectly assumes that arbitrators are required to file detailed opinions or findings of fact. The Supreme Court in Enterprise Wheel cautioned against outright judicial vacating of arbitrator awards because of ambiguity, incompleteness, or inconsistency, even in cases where the uncertainty relates not to the meaning of the award but to the sources of decision and, thus, ultimately to the question whether the award “draws its essence” from the agreement:

A mere ambiguity in the opinion accompanying an award, which permits the inference that the arbitrator may have exceeded his authority, is not a reason for refusing to enforce the award. Arbitrators have no obligation to the court to give their reasons for an award. To require opinions free of ambiguity may lead arbitrators to play it safe by writing no supporting opinions. This would be undesirable for a well-reasoned opinion tends to engender confidence in the integrity of the process and aids in clarifying the underlying agreement.

363 U.S. at 598, 80 S.Ct. at 1361.

Although the arbitrator could certainly have been more explicit in rendering his decision, I do not find that he went beyond the essence of the collective bargaining agreement. In other words, the plaintiff has presented no evidence that the award is “ ‘unfounded in reason and fact,’ is based on reasoning ‘so palpably faulty that no judge, or group of judges, could ever conceivably have made such a ruling,’ or is mistakenly based on a crucial assumption which is ‘concededly a nonfact’.” Betten-court v. Boston Edison Co., 560 F.2d 1045, 1050 (1st Cir.1977) (citations omitted). At most, the plaintiff has established that the case could have come out the other way, and perhaps, that there were gaps in the arbitrator’s reasoning.

Inasmuch as the employee Dirring has failed to establish either that the Union breached its duty or that the arbitrator exceeded his authority, the plaintiff’s motion for summary judgment is hereby DENIED and defendant Lombard’s cross-motion for summary judgment is hereby ALLOWED.

SO ORDERED.

      . See also, DelCasal v. Eastern Airlines, Inc., 634 F.2d 295 (5th Cir.) (recognizing that the union had authority to decide under what circumstances an attorney would be provided to the grievant, but that nonunion membership was an improper basis for making the determination), cert, denied, 454 U.S. 892, 102 S.Ct. 386, 70 L.Ed.2d 206 (1981). I should point out that I am unpersuaded by the plaintiffs argument that these cases, and others cited by defendant Lombard, are inapposite simply because they address the question of union-supplied as opposed to privately-retained counsel. It seems to me that the source of counsel’s compensation should not be solely dispositive of this issue.

      . The plaintiff would also have the Court find that the Union breached its duty by representing Mahoney at the same time. In his view, dual representation required separate hearings and did not permit either employee to cross-examine the other. I must reject this argument for two reasons. First of all, the Labor Law literature is replete with references to cases in which courts have upheld union representation of conflicting interests within employee ranks. Of course, the standard by which that representation is judged remains the same. That is, the union’s handling of one grievance cannot be so arbitrary or discriminatory that it prejudices the other. Thus, my second reason for rejecting Dirring’s argument is that given the factual background of the discharge — a very serious fight — it was entirely consistent with good faith and nonarbitrariness to hold separate hearings.

      . Q: Did you speak to Singelai [sic] about the fact that McVicar was working for Lombard?
      Q: At any time prior to your hearing before the Grievance Board or the Arbitrator—
      A: No.
      Q: — did you raise that point at the hearing? A: What do you mean?
      Q: The fact that they were related?
      A: Why would I raise the point?
      Q: Just yes or no.
      A: No.
      Dirring Deposition, at 11-12.

      . In the Union Railroad case, the grievance board upheld the employee's discharge. In the aftermath, the employee made various allegations of hostility and bias on the part of the union representative. The Third Circuit noted that any objection based on these allegations had been waived by failure to raise them initially: “When the reasons supporting an objection are known beforehand, a party may not wait to make an objection ... until after an unfavorable award has been made.” 648 F.2d at 913.

      . Accord, Keay v. Eastern Airlines, 440 F.2d 667 (1st Cir. 1971); Virgin Island Nursing Assoc. Bargaining Unit v. Schneider, 668 F.2d 221 (3rd Cir.1981).