W. Pa. Hospital v. Lichliter

Full title: Western Pennsylvania Hospital et al. v. Lichliter et al., Appellant

Court: Supreme Court of Pennsylvania

Date published: Jan 6, 1941

17 A.2d 206 (Pa. 1941)

17 A.2d 206

Opinion

November 26, 1940.

January 6, 1941.

Courts — Jurisdiction — Equity — Injunction against administrative agency — Inadequacy of legal remedy — Multiplicity of suits.

1. The court of common pleas has jurisdiction to enjoin an administrative agency of the state from exercising powers not conferred upon it, or unconstitutionally conferred upon it. [392-3]

2. An injured party whose rights are transgressed is entitled to equitable relief when the legal remedy is neither full, complete nor adequate. [393]

3. The avoidance of a multiplicity of suits is a ground for equitable relief. [393]

Labor law — Labor Anti — Injunction Act of 1937 — Pennsylvania Labor Relations Act of 1937 — Construction — Hospitals — Definition — Governmental function.

4. The Labor Anti-Injunction Act of June 2, 1937, P. L. 1198, as amended, is not applicable to a hospital. [387, 388]

5. The words "industry, trade, craft or occupation" as used in Section 3(a) of the Labor Anti-Injunction Act do not include the operations of a hospital. [386-7]

6. The word "employer" as defined in section 3(c) of the State Labor Relations Act of June 1, 1937, P. L. 1168, as amended, does not include a hospital. [386-7]

7. Hospitals are scientific institutions created for a humane purpose in amelioration of the sufferings of mankind. [389]

8. The State Labor Relations Act does not confer upon the Pennsylvania Labor Relations Board any jurisdiction over a labor dispute between a hospital and its employees. [388-91]

Argued November 26, 1940.

Before SCHAFFER, C. J., MAXEY, DREW, LINN, STERN and PATTERSON, JJ.

Appeal, No. 18, May T., 1941, from decree of C. P. Dauphin Co., Equity Docket No. 1533, 789 Com. Docket, 1940, in case of The Western Pennsylvania Hospital et al. v. Levi G. Lichliter et al., Pennsylvania Labor Relations Board et al. and the Hospital Workers Local Union No. 255 of the State, County and Municipal Workers of America, et al. Decree affirmed.

Bill in equity.

The facts are stated in the opinion of the court below, by RICHARDS, P. J., specially presiding, as follows:

On July 1, 1940, this Court, without hearing, granted a preliminary injunction restraining the Pennsylvania Labor Relations Board from proceeding in any way under the Pennsylvania Labor Relations Act, against the plaintiff hospitals, and restraining Hospital Workers Local Union No. 255 of the State, County and Municipal Workers of America, affiliated with the Congress of Industrial Organization, from asserting any rights against the plaintiff hospitals, under said Act, and from presenting any charges, complaints or proceedings thereunder against the plaintiff hospitals. Thereafter, the Board filed an answer raising preliminary objections to the bill and the local union presented a petition under the Act of 1925, challenging the jurisdiction of the Court to issue said injunction. Argument on both was heard by the Court en banc and the matter is now before us for disposition.

THE BILL.

The essential averments of the bill are as follows:

The plaintiff hospitals of Allegheny County are public charitable institutions, in part supported by State appropriations, engaged in rendering free medical and surgical services to the indigent sick, injured and disabled. The hospitals are non-profit corporations not engaged in industry, commerce, trade, business or production. In rendering such services the hospitals are performing a function of the government. The defendant union has attempted to unionize the employees of said hospitals and has made demands upon said hospitals. The latter refused to recognize the union, whereupon it filed a petition with the Labor Board alleging unfair labor practices under the Pennsylvania Labor Relations Act. The services required of the plaintiff hospitals necessitate minute and efficient supervision which should not be disrupted by union activities, to the detriment and danger of patients. The hospitals are not employers, nor those sought to be unionized employees within the provision of the Labor Relations Act. That any attempt by the Labor Board to conduct an investigation, issue subpoenas or hold hearings would greatly interfere with the management and operations of the hospitals. The bill further contends that equitable relief may be granted because the Board has no power to proceed against the plaintiffs, that a multiplicity of actions will be avoided and the improper expenditure of public funds prevented. There are many other averments but these we deem the most important. Others may be mentioned in the course of this opinion.

ANSWER RAISING PRELIMINARY OBJECTIONS.

The answer raising preliminary objections states that the "injunction awarded by the court is illegal and void on its face, by reason of the Labor Anti-Injunction Act," and the Pennsylvania Labor Relations Act; that the plaintiffs have a full, complete and adequate remedy at law, and that the bill does not state a cause of action.

PETITION UNDER ACT OF 1925.

The petition of the defendant union, presented under the Act of 1925, P. L. 23, questions the jurisdiction of this Court to issue the injunction. It is alleged that jurisdiction of the matter covered by the bill of complaint has been exclusively vested by the Legislature in the Pennsylvania Labor Relations Board, that administrative remedies must be exhausted before judicial relief is sought, and that the bill states no cause of action.

DISCUSSION.

As the matter now stands, the averments of the bill must be taken as true. These averments show that most, but not all, of the plaintiff hospitals receive State aid. They are also supported in part by charity. The property of the hospitals has a value in excess of $36,000,000. They employ and pay upwards of 5,697 persons, of which number 603 have the power to hire and fire. In addition there are some 1756 student nurses connected with the hospitals and many internes. Many graduate nurses privately employed are engaged in work in said hospitals. During the twenty-one months immediately preceding March 1, 1940, these hospitals engaged in 3,643,968 hospital or patient days of service of which 1,054,480 days of free service were rendered to the indigent. This represented service to 230,663 persons of which 78,137 received free attention because they were unable to pay. During the same period the hospitals, in addition to the above, handled more than 800,000 dispensary visits at a cost of about $700,000. During 1938, twenty-one of the plaintiff hospitals performed free service to the indigent and poor at a cost of $2,390,000, of which amount the State contributed $665,000. The difference was made up from charitable contributions. For the fiscal year ending May 31, 1939, excluding one hospital, there was an operating deficit for the plaintiff hospitals of $464,000, and of the twenty-five hospitals involved only six failed to show deficits.

The Bill states that the formation of a union among the hospital employes would result in demands of such a character as to jeopardize the financial ability of the hospitals to function and that efforts to enforce these demands by strikes or otherwise would seriously imperil the management of the hospitals and the lives, health and safety of the patients. The demands already made would entail an increased yearly outlay of over $2,000,000, and, it is contended, would, if granted, in effect transfer control of the hospitals from their officials to the union. The hospitals refused to execute the proposed agreement or to negotiate any agreement, whereupon the union invoked the jurisdiction of the Labor Board and charged unfair labor practices. The Board has either begun or is about to begin investigation of the charges which will entail expenditure of public funds for the purpose. It is contended that in making such investigation the Board is exceeding its legal authority, since the hospitals are agencies of the State and as such are not employers within the meaning of the Act.

THE LABOR ANTI-INJUNCTION ACT. June 2, 1937, P. L. 1198; 1939, P. L. 302.

We think it will simplify matters to decide at the outset whether or not the Labor Anti-Injunction Act applies to the present situation. If so, the Court was without authority to issue the preliminary injunction before hearing: Sec. 9.

Our first consideration is: Does a labor dispute exist? It is provided in Sec. 3(a) of the Act that:

"(a) A case shall be held to involve or grow out of a labor dispute when the case involves persons who are engaged in a single industry, trade, craft, or occupation. . . ."

A hospital is not an industry. Neither are the employes of a hospital engaged in a single trade, craft or occupation. Student nurses, internes, doctors, surgeons, clerks, stenographers, bookkeepers, elevator operators, ambulance drivers, laundresses, mechanics, technicians, char-women and others may be employed by a hospital. They may have a common employer but they have no single trade, craft or occupation. Giving the words "industry, trade, craft or occupation" their commonly accepted meaning, we feel that they do not include the operations of a hospital.

Even though the words of the statute be interpreted as broad enough to include the operations of a hospital, we do not think that the legislature intended such a result. The purpose of the Act is to preserve the status quo during labor disputes, to insure the right to bargain collectively, and to give to employees the right to choose representatives for this purpose. To show the scope of the Act, the Legislature attempted to define cases which "involve or grow out of a labor dispute." In doing so, it used the words "industry, trade, craft or occupation." It has not been the custom in the past to unionize hospitals. The effect of unionization and attendant efforts to enforce demands would involve results far more sweeping and drastic than mere property rights. The question of profits for the employer or wages for the employee are not alone involved. It is not merely a matter of suspending operations, ceasing work and stopping production, such as might be true in a steel mill or automobile factory. It is a question of protecting the health, safety and, in many cases, the very lives of those persons who need the service a hospital is organized to render. The results are quite different and more extensive than are involved in an ordinary labor dispute. We cannot conceive that the Legislature intended to include hospitals within the purview of the Act. Consequently, even though the words used might conceivably be broad enough to include a hospital, nevertheless, a hospital is not within the spirit of the Act, and not being within the spirit, the Act does not apply to it. That this is so, is shown by the much cited case of Holy Trinity Church v. United States, 143 U.S. 457, 459, where it is said: "It is a familiar rule, that a thing may be within the letter of the statute and yet not within the statute, because not within its spirit, nor within the intention of its makers. This has been often asserted, and the reports are full of cases illustrating its application. This is not the substitution of the will of the Judge for that of the legislator, for frequently words of general meaning are used in a statute, words broad enough to include an act in question, and yet a consideration of the whole legislation, or of the circumstances surrounding its enactment, or of the absurd results which follow from giving such broad meaning to the words, makes it unreasonable to believe that the legislator intended to include the particular act."

We are convinced not only that the words used in the Act have no application to a hospital, that no labor dispute is involved as defined by the Act, but also that the effects of holding to the contrary would be so dangerous, disastrous and absurd as not to be within the intent of the legislature. Hence, we hold that the Labor Anti-Injunction Act is not applicable, and that nothing therein legally deprived the Court of the power to issue the preliminary injunction in this case, before hearing.

PENNSYLVANIA LABOR RELATIONS ACT. June 1, 1937, P. L. 1168; 1939, P. L. 293.

We will next consider whether there is anything in the Pennsylvania Labor Relations Act which deprives this Court of the power to issue the preliminary injunction granted in this case. This Act was designed "to protect the right of employes to organize and bargain collectively." A labor board was created to carry out the provisions of the Act. Within the scope of its authority this Board initially exercises certain powers. With these the Courts have nothing to do until resort is had to them for aid in enforcing orders, or in cases of appeal. But the present question is whether the plaintiff hospitals are employers within the meaning of the Act.

We will again advert to the Holy Trinity Church Case, supra. Here an Act of Congress was involved which made it unlawful to prepay the transportation of any alien into the United States under any contract or agreement made previous to migration to perform service of any kind in the United States. The Church made a contract with an alien preacher to serve as its Pastor. The Circuit Court held that the Act applied but the Supreme Court reversed, using the language we have quoted above. In other words, it was conceded that the literal reading of the statute included the contract of the alien preacher, but it was held that the statute was never intended to apply to such a case.

We have already outlined our views as to the applicability of the Labor Anti-Injunction Act to hospitals. All that we have said is equally true with reference to the Pennsylvania Labor Relations Act. Hospitals are scientific institutions created for a humane purpose in amelioration of the sufferings of mankind. They require for their successful operation highly skilled physicians, surgeons, technicians, experts and nurses. They likewise require the services of other persons, some of whom may be skilled and some unskilled. But the whole must be coordinated, controlled and uninterrupted to accomplish the general purpose. This would be impossible, should we hold the Labor Act applicable with all its attending ramifications, interruptions and possible cessation of service due to labor disputes and attending financial inability to function. Surely the Legislature had no such intention and we cannot so find in the absence of a clear and positive declaration to that effect.

In addition, it will be noted that the term "employer," as defined by the act, excludes the Commonwealth or any political subdivision thereof. Of course, the plaintiff hospitals are not political subdivisions of the Commonwealth. They are, however, with few exceptions, agencies selected by the Commonwealth as a means of assisting in some degree, the indigent sick, disabled, injured or afflicted. Should the state choose to operate general hospitals, as it does certain mental hospitals, no one would claim that it was not performing a function of government and in so doing is not an employer within the meaning of the Act. Since the State chooses to perform this function through agencies, supported in part by State appropriations, these agencies are likewise beyond the scope of the Act. Were this not so, the appropriations might be diverted from their intended purpose to aid the indigent sick and injured to the payment of wages and increased operating costs. We think it obvious and indisputable that hospitals of this character are impressed with a public interest which takes them out of the purview of the Act. That the State has an obligation to care for the indigent sick is shown by such cases as Busser v. Snyder, 282 Pa. 440, and Collins v. Martin, 290 Pa. 388. The opinion in the former case states, at page 445: ". . . There are diverse classes of individuals who become charges on society as a seemingly necessary incident to our form of government. And among these are aged, infirm, lame, blind or sick, who are unable to support themselves or who have no means of support, and there are no other persons required by law to support them. Pennsylvania early recognized her obligation to all citizens in this respect, and has faithfully kept it." (Underscoring [italics] supplied.)

In the latter case at page 395 the opinion states:

"As a sovereign, the state may be generous . . . and give money with or without adequate equivalent in return, as, for illustration, the relief of the indigent in case of sickness or injury . . ." (Underscoring [italics] supplied.)

Our thought that this Act does not apply to an agency of the State finds some support in Retirement System v. Dauphin County et al., 335 Pa. 177. Here the Supreme Court held that neither the City of Harrisburg nor the County of Dauphin could tax real estate owned by the State Employees Retirement Board. Although the property was owned by an agency separate from the State, having corporate powers and receiving only part of its funds from the Commonwealth, the Court decided that it performs in large part a governmental function and should be treated like the Commonwealth and be exempt from taxation even though the property involved is used for profit.

For the reasons stated, we conclude and hold that the Pennsylvania Labor Relations Act does not apply to the present situation and that nothing therein has the effect of divesting this court of the power to issue the preliminary injunction.

JURISDICTION OF THE COURT, OF THE BOARD AND ADMINISTRATIVE REMEDIES.

The answer of the Board and petition of the union assert that the jurisdiction of the Board is exclusive; that the administrative remedies prescribed therein must be followed and exhausted; that the Board must, in the first instance determine its own jurisdiction; that the court has no jurisdiction to restrain the Board from applying the Act, on the ground that it does not apply to the plaintiffs; and that while recourse may be had to the courts for aid in enforcement of the Act, or upon appeal, that no such situation is presented by the facts of the case now before us. This, in effect means that the plaintiffs may seek judicial relief only on appeal from the action of the Board.

Counsel for the plaintiffs frankly concede that this position is in accord with some of the federal cases, particularly Myers v. Bethlehem Shipbuilding Corp., 303 U.S. 41, and Newport News Co. v. Schauffler, 303 U.S. 54. It is contended, however, that there are substantial and controlling differences between those cases and the present one. In those cases there was but a single plaintiff and the question of multiplicity of suits was not involved. There was no question of protecting the public interest such as is presented by the plaintiff hospitals, as only the rights of private corporations were involved. Finally, that the law of this state is that administrative tribunals which exercise or attempt to exercise powers not granted to them may be restrained by the courts.

We think there is considerable merit in these contentions. The Courts of Common Pleas may still exercise the equitable powers conferred upon them by the Act of 1836, P. L. 784, 17 PS 281, and the Act of 1857, P. L. 39, 17 PS 285, unless these powers have been taken away from them by some statute. We have already reached the conclusion that, so far as this case is concerned, neither the Labor Anti-Injunction Act nor the Pennsylvania Labor Relations Act has divested this Court of its equitable powers to issue the injunction, nor have counsel referred us to any other statute having that effect. We know of no case where the Supreme Court of this State has held that equity may not restrain an administrative agency from exercising powers not conferred upon it by the Legislature. On the contrary, there are many cases where such action has been confirmed. In York Railway Co. v. Driscoll et al., 331 Pa. 193, a situation was presented where this court had restrained the Public Utility Commission from exercising powers not delegated to it. The Railways had also appealed from the action of the Commission. Both matters finally came before the Supreme Court. In the course of its opinion it laid down the rule, at page 196, that: "We have no doubt about the right, indeed the duty of the Dauphin County Court, to entertain a bill to enjoin the Commission from acting in this case or in any other in which the powers and authority of the Commission to act are called in question: Citizens Passenger Ry. Co. v. P. S.C., 271 Pa. 39; Phila. Elec. Co. V. P. S.C., 314 Pa. 207."

In Rich Hill Coal Co. v. Bashore, 334 Pa. 449, this court enjoined the Workmen's Compensation Board from exercising powers unlawfully delegated to it. The Supreme Court affirmed. Many other cases could be cited to the same effect, but we feel that these are sufficient to show that the Courts, in the exercise of their equitable powers, may enjoin an administrative agency of the State from exercising powers not conferred upon them or unconstitutionally conferred upon them.

An injured party whose rights are transgressed is not obliged to pursue his strict legal remedy when the relief thereby afforded is neither full, complete nor adequate. We have the further consideration of avoiding a multiplicity of suits should each hospital be subjected to the expense and necessity of exhausting the administrative remedies afforded by the Act and thereupon appealing to the appropriate court.

We feel that the present case is similar in some, but not all, its aspects to Jewish Hospital of Brooklyn v. Doe et al., reported in 300 N.Y. Supplement, page 1111, where a restraining order was issued under somewhat similar circumstances. While this case deals largely with an anti-injunction Act very similar to that of Pennsylvania, it contains much comment relating to the nature of hospitals and their relation to government. Without attempting to quote from this opinion, we will simply say that it confirms the conclusions we have reached.

CONCLUSION.

We conclude, that the plaintiff hospitals are not obliged to pursue the administrative remedies afforded; that neither the Pennsylvania Labor Relations Act nor the Labor Anti-Injunction Act apply to the present situation; and that this court had the power, and it was its duty, to grant the preliminary injunction under the circumstances of this case, without hearing.

DECREE.

And now, to-wit: July 29, 1940, the answer raising preliminary objections to the bill is dismissed. The petition of the defendant union raising jurisdictional questions is dismissed and the rule granted thereon is discharged. The defendants are required to file an answer to the bill within thirty days under penalty of having the bill taken pro confesso. The Prothonotary is directed to notify the parties or their counsel of this decree forthwith.

Defendant, Hospital Workers Union, appealed.

Error assigned, among others, was decree dismissing petition raising question of jurisdiction.

Sidney G. Handler, with him Benjamin C. Sigal, for appellant.

John W. Kephart, with him H. G. Wasson, Seward H. French, Jr., Reed, Smith, Shaw McClay and George Ross Hull, for appellees.

J. Charles Short, Solicitor, M. Louise Rutherford and William M. Rutter, Deputy Attorneys General, and Claude T. Reno, Attorney General, for Pennsylvania Labor Relations Board, interested party.

PER CURIAM, January 6, 1941:

The decree of the court below is affirmed on the comprehensive opinion of Judge RICHARDS. Costs to be paid by appellant.