Decker Coal Co. v. State Employment ( 1983 )


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  •                                            NO.   82-359
    I N THE SUPREME C O U R T OF THE STATE OF MONTANA
    1983
    DECKER COAL COMPANY, a j o i n t v e n t u r e b e t w e e n
    Western M i n e r a l s , I n c . , a n Oregon c o r p o r a t i o n
    and Wytana, I n c . , a Delaware c o r p o r a t i o n ,
    Petitioner        and Respondent,
    vs.
    EMPLOYMENT SECURITY DIVISION OF THE MONTANA
    STATE DEPARTMENT OF LABOR A N D INDUSTRY a n d
    THOSE MEMBERS OF THE PROGRESSIVE MINE WORKERS
    OF AMERICA, S h e r i d a n , W y o m i n g , who a r e
    Claimants i n Board o f Labor Appeals Decision
    No. 2 6 0 1 ,
    Respondents and Appellants.
    Appeal    from:      D i s t r i c t Court of the Thirteenth Judicial,
    I n and f o r t h e County o f B i g Horn
    Honorable Robert Wilson, Judge p r e s i d i n g .
    Counsel of      Record:
    For Appellants:
    H i l l e y and L o r i n g , G r e a t F a l l s , Montana
    E m i l i e L o r i n g a r g u e d , G r e a t F a l l s , Montana
    R. S c o t t C u r r e y a r g u e d , H e l e n a , Montana
    For Respondent :
    Holland & Hart, B i l l i n g s ,        Montana
    Carey E. Matovich argued,                Billings,        Montana
    Submitted:        March 2 4 ,     1383
    Decided:        ~ u l y , 1983
    5
    -_I_c_
    4%                  C l e r k
    Mr. Justice John C. Sheehy delivered the Opinion of the
    Court.
    Appellants (collectively hereafter "claimants") appeal
    from a decision of the District Court, Thirteenth Judicial
    3 3 1deed
    ~
    District, PCounty, which                           in effect held       that
    claimants       were    not   entitled     to   unemployment        insurance
    benefits.
    Two principal issues arise in this appeal.              The first is
    procedural,        raised      by    us,    whether        MAPA      (Montana
    Administrative Procedure Act) applies to agency and court
    handling of claims for unemployment insurance benefits (for
    brevity "claims").          The second issue is substantive, whether
    a stoppage of work occurred which disqualified claimants for
    benefits.
    We hold that MAPA does not apply to the determination of
    such claims; and that the claimants in this case are entitled
    to unemployment insurance benefits.
    Nearly      all     members    of    Local     1972,        Progressive
    Mineworkers of America, employees of Decker Coal Company,
    filed claims for unemployment compensation benefits for the
    period from August 15, 1980 to September 15, 1980, during
    which    time    the    local was    engaged    in a   labor strike at
    Decker's surface coal mine in Big Horn County, Montana.
    The claims were submitted for decision to a deputy of
    the     employment      security    division    of   the    Montana    State
    Department of Labor and Industry, who determined that the
    claimants were not eligible for such benefits because of a
    stoppage of work during the strike.             The adverse decision of
    the deputy was appealed by claimants to an appeals referee
    who   after     hearing, made       a written decision denying the
    claimants any unemployment insurance benefits, and finding
    that a work stoppage existed during the period of the strike.
    The    claimants appealed     the decision of the appeals
    referee to the Board of Labor Appeals.             The Board reversed
    the    decision    of   the   appeals   referee, holding       that   the
    claimants were entitled to receive unemployment compensation
    benefits      in   accordance with      their   claims,   if   otherwise
    qualified.
    Decker appealed the Board's decision to the District
    Court.       There the Board was reversed and the decision of the
    appeals referee was reinstated.         A fina.1 order was entered by
    the District Court accordingly, and this appeal ensued.
    I.    DOES MAPA APPLY TO CLAIMS FOR UNEMPLOYMENT
    INSURANCE BENEFITS?
    In this case, the District Court applied the provisions
    of    MAPA,    particularly   section    2-4-621, MCA,     instead    of
    applying the unemployment insurance law.             In reversing the
    holding of the Board of Labor Appeals, the District Court
    stated in this case:
    "The Board of Labor Appeals is held to the same
    standard of review of a fact finder's decision as
    is this Court.    The Board cannot substitute its
    judgment as to the weight of the evidence on
    questions of fact for that of the appeals referee.
    The Board may reverse or modify the decision of the
    appeals referee only if substantial rights of a
    party have been prejudiced because administrative
    findings are 'clearly erroneous in view of the
    reliable, probative and substantial evidence on the
    whole record' or is 'affected by other error of
    law. '    ...  The decision of the Board of Labor
    Appeals exceeded its scope of jurisdictional
    authority by substituting its judgment of the facts
    and the weight of the evidence for that of the
    appeals referee."
    Thus the District Court determined, and Decker here
    contends that the Board of Labor Appeals could not reject or
    modify the findings of fact of the appeals referee unless the
    Board first determined from a review of the complete record
    that the findings of fact of the appeals referee were not
    based        upon    competent,    substantial evidence       or   that   the
    proceedings on which the findings were based did not comply
    with essential requirements of law.
    With respect to this issue, this case parallels another
    case recently before this Court, cause no. 82-106, City of
    Billings v. State of Montana Board of Labor Appeals, Montana
    State Department of Labor and Industry, and 325 Members of
    Local No. 190, Teamsters Union (Decided May 10, 1983) ,
    P.2d            ,    40 St.Rep.    648.   In that case we examined the
    provisions of MAPA, and of the unemployment insurance law.
    We refer the reader to that case for our rather complete
    discussion of the applicability of each set of statutes to
    the     determination        of    disputed    claims   for   unemployment
    insurance benefits.               It is enough to say here, for the
    convenience of the reader, that in City - 
    Billings, supra
    ,
    of
    we determined:
    1.          There   is    contained    within   the   unemployment
    compensation insurance law itself, without regard to MAPA, a
    complete procedure for hearing and determining undisputed
    claims for unemployment insurance benefits, beginning with
    the deputy of the employment security division, and ending
    with the Montana Supreme Court.               Sections 39-51-2401 through
    39-51-2410, MCA.
    2.      The Board of Labor Appeals, as a quasi-judicial
    board (section 2-15-1704, MCA) exercises the functions of a
    quasi-judicial board as outlined in section 2-15-102(9), MCA.
    As such the Board of Labor Appeals may consider not only the
    record made before the appeals referee but new evidence
    produced at the Board hearing.
    3.       The provisions of MAPA           are unworkable when an
    attempt       is made      to    apply   them    to determine claims            for
    unemployment         insurance     benefits.           It   is    an      incorrect
    interpretation of statutory law to hold that the Board has no
    power to overturn the fact-findings of the appeals referee.
    4.     The District Court, in reviewing of a decision of
    the Board of Labor Appeals, is limited by the provisions of
    section 39-51-2410(5), MCA, which provides:
    "In any judicial proceeding under 39-51-2406
    through 39-51-2410, the findings of the board as to
    facts, if supported by evidence and in the absence
    of fraud shall be conclusive and the jurisdiction
    of said court shall be confined to questions of law
    . . .   I1
    We reiterate the foregoing interpretations of statutory
    law contained in City - 
    Billings, supra
    , as applied to this
    of
    case.        It was error for the District Court to limit the power
    and authority of the Board of Labor Appeals by applying MAPA
    provisions against it.            The powers and duties of the Board of
    Labor Appeals are to be found in the unemployment insurance
    law, and in the provisions of law granting it authority to
    act as a quasi-judicial board.
    DID A STOPPAGE OF WORK OCCUR WHICH DISQUALIFIED CLAIMANTS?
    Again we determine, as we did in - -of Billings,
    
    City supra
    , that the appeal by the claimants to this Court in this
    case squarely places upon us the duty to determine if the
    findings of the Board of Labor Appeals are supported by
    evidence as set forth in section 39-51-2410(5), MCA, and if
    so, whether the Board properly applied the law to those
    facts.         We    so   hold    because   it    is    the      intent    of   the
    unemployment insurance law that claims for benefits be given
    accelerated judicial attention (section 39-51-2410(5), MCA)
    and further because the District Court in this case has
    already concluded that the decision of the appeals referee
    (not the Board) was not clearly erroneous and is supported by
    reliable, probative and substantial evidence on the whole
    record; and further that the Board of Labor Appeals' decision
    is erroneous because it is not based upon reliable probative
    and substantive evidence on the whole record.               In those
    circumstances, the appeal by         the claimants to this Court
    makes it imperative for us to determine if the findings of
    the Board are supported by evidence and whether the law was
    properly applied to the facts.
    If the findings of the Board are supported by evidence,
    in the absence of fraud, such findings are conclusive, and
    the jurisdiction of the District Court and, on appeal, this
    Court,   is   confined      to    questions     of   law.    Section
    At oral argument in this case, a discussion arose as to
    the kind of evidence which would be deemed supportive of the
    findings of the Board.      We conclude from the regulations of
    the Board that there must be "substantial evidence".         Section
    24.7.301(c) (vii), A.R.M.         "Substantial evidence" has been
    defined by this Court:
    "We have recently stated substantial evidence is
    evidence such as will convince reasonable men and
    about which reasonable men will agree supports the
    case of the prevailing party.        (Citing cases. )
    Furthermore, the evidence ma.y be inherently weak
    and still be deemed substantial, and substantial
    evidence   may   conflict   with    other    evidence
    presented.   (Citing cases)       " ...Matter of the
    Estate of Holm (1979),                    ,
    Mont. - 
    588 P.2d 531
    , 534.
    By way of preface, Decker Coal Company had two primary
    customers for its coal from this mine, Commonwealth Edison
    and   Detroit Edison.       The    coal   contracts of Decker are
    commitments to these utilities, but it is the utilities that
    determine how much     coal is needed by        them.      Management
    testified before the appeals referee "[ilf the utilities are
    not taking coal, it slows our production down.          That's why it
    is not indicative month to month."             In the year of the
    strike, Decker was several million tons under its commitment
    to the utilities, simply because        the utilities were not
    taking coal.
    We turn now to the essential facts found by the Board of
    Labor   Appeals   to   determine   if   they    are     supported   by
    substantial evidence in the record.      Then it would remain to
    us to determine if the Board properly found that there was
    not a   "stoppage of work" as that term           is used     in the
    unemployment insurance law.
    The applicable statute is section 39-51-2305(l), MCA:
    "Effective April 1, 1977, an individual shall be
    disqualified for benefits for any week with respect
    to which the department finds that his total
    unemployment is due to a stoppage of work which
    exists because of a labor dispute at the factory,
    establishment, or other premises at which he is or
    was last employed   . . ."
    The Board found that during the strike "the employer
    continued to supply the needs of its customers in furnishing
    coal, it being the business of the employer to mine and
    deliver coal to customers."    This finding is substantiated in
    full by the testimony of management witness Crilley that
    customers1 needs were supplied during the strike.
    The Board found that "there is no other substantial
    evidence, excluding argument, which would indicate anything
    other than the fact that the employer in this was able to
    fully supply the needs of its customers during that period."
    Again that is fully substantiated by the testimony of the
    management witness Crilley.
    The     Board     found      "a deliberate effort was made                and
    accomplished to stockpile coal in preparation for the strike
    so   that    the     functions          of    the   employer    would    not    be
    interrupted insofar as delivering coal to its customers is
    concerned."        This was substantiated by the labor witnesses,
    and by the management witness Crilley, who testified that
    before the strike, the "stockpile was larger than normal."
    The Board found by "the testimony of Mr. Crilley, the
    only officer to testify on behalf of the company, that the
    amount of coal that was removed or delivered from the mine or
    mining area from the standpoint of number of trains is not
    indicative of whether or not the strike was having any effect
    on the operations of the employer and specifically that sworn
    testimony     by     Mr.    Crilley          appears   on    page   49   of    the
    transcript, lines 1-3, and on page 59 of the transcript,
    lines 27-29."        We have quoted some of that testimony above,
    and the citations to the transcript bear out the findings of
    the Board.
    The Board concluded "therefore any finding as to the
    percentage of the number of trains in the strike was not in
    any way supportive of any conclusion as to whether or not
    there was a substantial reduction in the functioning of the
    employers mining operation."                  This is a conclusion of fact
    and law which the Board as a quasi-judicial board may draw.
    The Board found "the greater weight of the evidence
    further     establishes          that    during     the     testimony    of    the
    representatives of the employer, that during the period of
    the strike, they were able to maintain the necessary everyday
    maintenance     upon       the    equipment."          On    this   point,     the
    testimony of the management witness was:
    "Chilton: Were there any breakdowns in equipment?
    Crilley: Oh yes.
    "Chilton:     Were they major?        Crilley:   One of them
    was, yes.
    "Chilton: What did that entail? Crilley:       Just
    everybody they could find went and got together and
    fixed it and put in long hours to get it done.
    "Chilton:    How long was the plant shut down?
    Crilley :  I can't recall.    I couldn't recall,
    probably, I don't know. Maybe it was             ...
    "Chilton:      A matter of hours or days?             Crilley:
    Hours.
    "Chilton: Hours?         Crilley:       Probably close to a
    day, I suppose."
    The Board then found ''the evidence does establish that
    there     was   some     reduction      in    the   amount   of   preventive
    maintenance,        however,    there    is    no    indication   that   the
    reduction in the amount of preventive maintenance in anyway
    interfered with         the continual operation of the mine              and
    delivery of coal."        On this finding, the Board is half right.
    There was no preventative maintenance done according to the
    testimony of Crilley.          However, it is true that there is no
    showing in the testimony that the reduction in the amount of
    preventative maintenance interfered with the operation of the
    mine.
    The Board further found "the evidence establishes that
    there was no backlog of orders, no accumulation of work to be
    done following the strike."             On this point, the question by
    the appeals referee was whether there was a backlog of coal
    orders after the strike, and Crilley could not give him that
    information.
    The Board      then   found that "the evidence establishes
    without dispute that shortly after the strike terminated, the
    work force at the mine was reduced by approximately 64 men
    (20     or   more    being     maintenance      men)   and   supports    the
    conclusion of fact that both the employer and the claimants
    conceded that there was an overstaffing of the mine prior to
    the time that a strike took place."              That evidence came from
    the unsworn testimony of Crilley, who at the Board hearing
    informed the Board that 22 of the 64 people laid off were
    maintenance people.         The finding bears on the contention of
    the appeals referee that the "72 people who remained on duty
    during the strike could not have performed the work of the
    441 union members who were on strike."
    The Board further found "the evidence also establishes
    that although there was somewhere in excess of 400 employees
    of the mining operation in the bargaining unit, a number of
    the     operations   of     the    mine   were   run   upon   a    rotating
    four-shift basis.      Although there may be all of them working
    for some period of time during any weeks of operation, the
    number of hours that any one man was working would vary
    anywhere from one shift to several shifts and that on the
    average there was always one shift that was not working where
    there was a four-shift rotation basis, and in addition to
    that, prior to the time when the strike took place, the mine
    was on a reduced schedule and those men who were working were
    working in the area of 32 to 36 hours per week."                  There can
    be no dispute about this finding of fact.                All through the
    record there are notations to the effect that the men worked
    from one to four days per week because they were on rotating
    crews    and   the   mine    was    operating    on    reduced    schedules
    allowing the workers to get 32 to 36 hours per week.                 As we
    have indicated, in the year of the strike, Decker was several
    million tons under their commitment because the utilities
    were not taking coal.
    Then the Board found "during the period of the strike,
    the   evidence    establishes that       there were    72 first line
    supervisor personnel working in connection with the operation
    of the mine, and in addition thereto, there were at least 6
    persons of administrative personnel who were not first line
    supervisors who were working in connection with the operation
    of the mine.      Taking into account the first line supervisors
    and other administrative personnel, the evidence establishes
    that there was a total of approximately 120 administrative
    and supervisory personnel working during the course of the
    strike. "   Again this figure comes from the unsworn testimony
    at the Board hearing in a colloquy between the attorney for
    the employer and the chairman of the board.                 It follows:
    "Houston:   Okay now, if you look at the figures
    which I think I worked up in the reply brief before
    Mr. Chilton. We assumed 72 supervisors and the 72
    supervisors I think first appears in the transcript
    by Mr. Rinker. Where he gets that figure, I don't
    know, and then throughout the transcript, the 72 is
    continually referred to.      Perhaps the correct
    number of supervisors is 62 and there is an
    additional 6 or however many. Maybe it was 72, but
    I think the number of people, supervisors,
    overhead-type people, salaried personnel-actually
    working during the strike is probably someplace
    around 72 working on production needs.
    llWhalen: Now wait a minute.  It was Mr. Crilley
    that shuffled it up to 120 during his testimony.
    "Houston:     120 reflects         everyone     out   there:
    secretaries, clerks.
    "Whalen:    He referred to
    "Houston: The whole gamut.
    "Whalen: 72 supervisors, first line supervisors,
    and 120 altogether in my record.     That's Mr.
    Crilley's testimony.
    "Houston:
    14-15.
    Right   . . .   l1   Board Hearing Tr. at
    The Board next found "as to those people working upon
    the production, the evidence establishes without dispute that
    during the first few days of the strike, some of them were
    working as much as 24 hours a day without stopping and after
    the strike was in progress, it was developed into a schedule
    where they were working 12 hours shifts, 7 days per week in
    operating      the   mine    with    administrative       and   supervisory
    personnel."      There are many references to these facts in the
    transcript and they cannot be disputed.
    Following this, the Board found "the evidence further
    establishes without dispute that during the course of the
    strike, there was a complete shutdown by sabotage which,
    attributable to person or persons other than the claimants in
    this case, reduced the production and the ability of the mine
    to function, however, it was not anything that came about by
    reason of a stoppage of work arising from the strike."                   This
    is an important finding by the Board because the appeals
    referee    failed     to    take    it   into   account    in   making   his
    findings   .    One of Decker's          former employees shot out a
    transformer which cut off power to the Decker mine and closed
    it down for 3 days during the first week of the strike.
    Crilley testified:
    "Crilley:        . . .
    Right, shortly after the strike
    started, we had the power line shot out by a former
    employee and it shut the mine down approximately 3
    days and at that time we really picked up security
    operations, and we drew several people from the out
    of town office which was supporting that too,
    Decker Coal, and they performed in a security
    fashion.
    "Houston:          Now you say that he was a                former
    employee?        How was he? Was he terminated?
    "Crilley: Oh, at that time he was still in limbo.
    The man, we'd laid the man off in April and he
    filed a grievance against us for the methodology of
    the layoff and that was in arbitration at the time.
    We have not reached the decision even, we already
    had an arbitration, but we were awaiting for an
    opinion of the arbitrator."
    It is quite evident that the person who committed the
    act of sabotage was not one of the claimants and it was not a
    union-encouraged act.
    The Board also found "the evidence before this Board and
    analysis     of       the    figures    furnished      by   the   employer    and
    submitted to the Board for the first time during the Board
    hearing insofar as inventory is concerned establishes that
    there was not a reduction in excess of the amount of 7
    percent of the inventory based upon the period and figures
    furnished by the employer."             We will take this point up later
    in discussing the appeals referee's finding on this subject.
    It is enough to say that there was a reduction in inventory
    during the strike from pre-strike levels of 5.47 percent and
    that in the period of 9 weeks following the strike, Decker's
    coal inventory decreased from the average during the strike
    by 10.08 percent.
    Next the Board found "the evidence further establishes
    that there was a reduction in production in the amount of
    approximatel-y 9            percent."     We    find    this could be        true
    depending upon what week one selected prior to the strike or
    after the strike.              On an average basis, it appears that
    production during the strike was 23.54 percent less than the
    pre-strike        9    weeks,     and    21.3    percent      less   than    the
    post-strike 9 weeks.              Again we will discuss these figures
    later with respect to whether a stoppage of work occurred
    here.
    The next finding of the Board relates to whether or not
    there was     stripping of overburden.                  Management testified
    there was not.         Labor witnesses testified that they could see
    blasting and smoke arising from the overburden which must
    have been used for the raising of overburden, and that when
    they went back to work there was less powder in the powder
    bins which substantiated their claim that powder had been
    used.         We   do   not   regard    this       finding    as   having   any
    significance on mine production for the purposes of this
    case, however.
    The last finding of the Board is that at the termination
    of the strike, the stockpile which had been prepared                         in
    anticipation of the strike had not been used up at the
    termination of the strike.              This is substantiated by the
    inventory of the coal company at the termination of the
    strike which showed 195,500 tons of coal on hand.
    As we have indicated in the foregoing, the findings of
    the Board are substantiated on the whole record, using the
    standard of substantial evidence.
    We turn now to the findings of the appeals referee,
    which the Board of Labor Appeals refused to accept, but which
    the     District    Court     found    were       supported   by    "reliable,
    probative and substantial evidence on the whole record."                    The
    District Court went no further than to state the foregoing
    conclusion.
    The essential facts found by the appeals referee on
    which    he    determined     there was       a    stoppage of work, are
    contained in the following paragraph:
    "In an 18-week period, 9 weeks before and 9 weeks
    after, the employer loaded and shipped an average
    of 22.8 trains per week. In the strike period, the
    average was 17 trains per week, a reduction of 25.4
    percent. In the same 18-week period, an average of
    235,373 tons of coal were mined per week but in the
    strike period, an average of 142,085 tons of coal
    were mined per week, a reduction of 37.5 percent.
    In the week before the strike commenced, the
    inventories, silos and      stockpiles, contained
    326,459 tons of coal.     In the last week of the
    strike the inventory was 195,569 tons, a 40.1
    percent reduction."
    During oral argument, counsel for Decker Coal Company
    contended that the Board of Labor Appeals did not hear the
    witnesses and see their demeanor and that because thereof the
    Board should be bound by the findings of the appeals referee.
    That contention belies what happened in this case.                        The
    appeals referee, after the hearing which he conducted, asked
    for post-hearing exhibits to be supplied by the employer as
    to the number of trains shipped by Decker pre-strike, during
    the strike, and post-strike, the number of tons of coal mined
    for those same periods, and the inventory of the company for
    the    same    periods.      Following     the    strike, the        employer
    submitted figures on those items, none of which are sworn to,
    and upon which there was no cross-examination, and for which
    the underlying documents were not supplied.                    Yet all of the
    conclusions of the appeals referee which we have quoted
    foregoing are based          upon      those unsworn      figures with      no
    supporting testimony.            In such a case, we are "free to make
    our    own    examination of       the   entire    case    and    to make   a
    determination in accordance with what we find."                   Kostbade v.
    Metier (1967), 
    150 Mont. 139
    , 141, 
    432 P.2d 382
    ; Estate of
    Jensen (1969), 
    152 Mont. 495
    , 500, 
    452 P.2d 418
    .
    It is true that at the Board hearing, there were no
    witnesses sworn to testify.              However, the Board obviously
    took    into   consideration statements made              by    Houston, the
    company attorney, Crilley, the company personnel manager,
    Loring, the labor attorney, and some labor witnesses.                   There
    is nothing in the Board regulations which require witnesses
    before it to be sworn.           The whole proceeding before the Board
    is apparently quite informal.
    What all this means is that this Court is in as good
    position      as   any   party    to   examine    the   figures     from the
    e x h i b i t s and t o d e t e r m i n e f o r o u r s e l v e s t h e e f f e c t o f       the
    strike.         We     display      some o f       those     f i g u r e s hereunder.          We
    have,      however,        disregarded           the    first      week     of   the      strike
    b e c a u s e t h e mine was s h u t down d u r i n g t h a t week f o r t h r e e
    days due t o t h e a c t o f s a b o t a g e which w e have r e f e r r e d t o .
    In   effect       we    assume       tha.t   the       production      during t h e        first
    week,     i f t h e a c t o f s a b o t a g e had n o t o c c u r r e d , would a v e r a g e
    o u t w i t h t h e r e m a i n i n g weeks o f t h e s t r i k e .
    INVENTORY
    The a p p e a l s r e f e r e e    found t h a t t h e i n v e n t o r y had been
    reduced a s a r e s u l t of t h e s t r i k e by 4 0 . 1 p e r c e n t .           The Board
    of   Labor Appeals            found t h a t       f i g u r e t o be       7 percent.         The
    a p p e a l s r e f e r e e a r r i v e d a t h i s p e r c e n t a g e f i g u r e by t a k i n g
    t h e l a s t i n v e n t o r y week b e f o r e t h e s t r i k e and comparing it
    w i t h t h e f i r s t i n v e n t o r y week a f t e r t h e s t r i k e had ended.          We
    t h i n k a f a i r e r way o f d e t e r m i n i n g t h e f a c t s r e l a t i n g t o t h e
    inventory         would       involve        a     comparison          of    the     9     weeks
    p r e - s t r i k e w i t h t h e 9 weeks f o l l o w i n g t h e s t r i k e t o d e t e r m i n e
    t h e i r usual averages.            Decker a r g u e s f o r t h i s approach i n i t s
    brief      stating:               "The    only     fair      way      to     compute       usual
    p r o d u c t i o n i s t o b a l a n c e good weeks w i t h bad weeks.                  A l l the
    e v i d e n c e was b e f o r e t h e a p p e a l s r e f e r e e and t h e Board,            and
    b o t h t h e good and t h e bad must be a v e r a g e d t o g e t h e r . "
    The p r e - s t r i k e   t o n n a g e o f c o a l i n s t o c k p i l e s and s i l o s
    on hand f o r t h e 9 weeks p r e c e d i n g t h e s t r i k e s f o l l o w s :
    207,915
    218,539
    246,996
    214,105
    197,773
    139,719
    252,196
    312,466
    326,459
    2,116,168 t o n s
    The   average    number      of     tons    on    hand    for the weeks
    preceding    the     strike   is    235,129.78         tons.      This   figure
    includes the stockpiling that was done prior to the strike
    and in anticipation of the strike.
    During the four weeks of the strike, the inventory of
    the coal on hand is represented by the following figures:
    195,569
    889,029 tons
    Therefore, the average number of tons on hand during the
    strike was 222,257.25 tons.
    These figures indicate the average number of tons on
    hand during the strike was only 12,872.53 tons less than the
    average number of tons on hand for the 9 weeks prior to the
    strike including stockpiling.             The 12,872.53 tons represents
    a decrease from the pre-strike average of 5.47 percent.
    In the 9 weeks following the strike, the post-strike
    inventory of coal is represented by the following figures:
    182,803
    1,798,645 tons
    The average of those figures is 199,849.44 tons.                       In
    other words, the        company had on hand as coal inventory
    following the strike, a lesser number of tons than it had
    during the strike.       The amount of decrease from the average
    tons of coal on hand during the strike is 10.08 percent.                     In
    fact, in the 9 weeks succeeding the strike, Decker kept on
    the   average   15    percent      less    coal    on    hand    than    it had
    stockpiled or possessed in silos in the 9 weeks preceding the
    strike.
    In the face of these figures, little validity can be
    attached      to    the   findings   of   the   appeals      referee   that
    inventory had been reduced 4 0 . 1         percent.        That figure is
    meaningless.
    TRAINS SHIPPED OUT
    The figures for the number of trains of coal shipped out
    from Decker for the 9 weeks preceding the strike are:
    13
    13
    17
    25
    32
    37
    21
    19
    20
    1 7 trains
    9
    The average shipment per week was 21.9 trains.
    The number of trains shipped for the 3 good weeks of the
    strike are:
    15
    20
    18
    -
    5 3 trains
    The average number of trains shipped out during the
    strike is 1 7 . 6 7 .
    The difference between 2 1 . 9       and 1 7 . 6 7   is 4.23.    This
    difference is a 1 9 . 3 percent reduction between trains shipped
    out during the strike and those shipped out pre-strike.                The
    appeals referee found 25.4 percent.
    Looking at the trains shipped out post-strike, those
    figures are as follows:
    - trains
    21
    192
    The average of the 9 weeks post-strike was 21.33 trains.
    This represents an increase of 3.66 trains per week over the
    strike average of 1 7 . 6 7     trains.     This means a 2 0 . 7    percent
    increase    in   the number of trains shipped out after the
    strike.     Again this is lower than the 25.4          percent found by
    the appeals referee.
    In connection with trains shipped out, we note a factor
    not for its argumentative force but to let the parties know
    that we have not overlooked it.           The Decker Coal Company mine
    apparently has a "sister mine" operated by the Big Horn Coal
    Company.     Decker Coal Company is a joint venture.                Wytana,
    Inc., a subsidiary of Peter Kiewit Sons, Inc. is one of the
    joint     venturers    and    Western     Minerals,    Inc.,   an    Oregon
    corporation, which may be a subsidiary of Pacific Power and
    Light is the other.      Big Horn Coal Company is a subsidiary of
    Peter Kiewit Sons, Inc.        The managing or operating partner of
    the Decker Coal mine is a subsidiary of the same holding
    company as Big Horn Coal Company.              It is to that extent,
    argued Decker's lawyer at the Board hearing, that the two are
    "sister companies."          They have some of the same customers.
    Decker     submitted   among    its     post-hearing    figures     to   the
    appeals referee a record of trains shipped out by Big Horn
    Coal Company.     These figures indicate an increase in trains
    shipped out by Big Horn Coal Company during the period Decker
    was subject to the strike.        The inference to be drawn is that
    Decker's commitments for coal were being met by Big Horn Coal
    Company.
    We disregard, however, the references to Big Horn Coal
    Company because the appeals referee made no findings with
    respect to that subject.         The Board of Labor Appeals gave it
    no   significance     in   its   consideration.      Nothing    in   the
    evidence or testimony connects Big Horn Coal Company with
    Decker's    production     and   operation other than     the    random
    statements made by the attorney at the Board hearing and the
    post-hearing figures submitted.         The Big Horn Coal Company
    figures     are    unsubstantiated,    unconnected,     and     so   are
    irrelevant to our discussion here.
    TONS MINED FROM THE PIT
    The appeals referee found that in the 18 week period
    before strike and after strike, Decker mined an average of
    235,373 tons of coal per week and that during the strike it
    mined an average of only 142,085 tons of coal per week, a
    reduction of 37.5 percent.
    Again, the figures used by          the appeals referee are
    skewed.      The   intensive     stockpiling undertaken by       Decker
    before the strike resulted in a mine production in excess of
    300,000 tons in three of the nine weeks before the strike
    occurred.    In the nine weeks following the strike, there was
    only one week in November when the coal production from
    Decker exceeded 300,000 tons in a week.           The appeals referee
    also included the week when the mine was down for three days
    as a result of the power outage induced by sabotage, when
    production was only 62,693 tons in the week.          The use of such
    figures does not fairly represent the loss of mine tonnage
    that occurred during the strike.                  If the one week of the
    strike is omitted, and all weeks exceeding 300,000 tons, the
    resulting decrease in mine production from the viewpoint of
    tons mined is no more than 23.54 percent.
    RELEVANCE OF FIGURES
    What we have attempted to demonstrate by the foregoing
    discussion is that the appeals referee was playing with
    numbers when he made the findings upon which Decker claims
    the District Court should be affirmed.               We have played with
    the numbers ourselves to demonstrate that depending upon the
    methodology, argument can be made to substantiate several
    positions favorable or not favorable to the claimants in this
    case.    There is no testimonial basis in the record, since the
    figures were        submitted post-trial          and without underlying
    documents or other proof which gives any degree of certitude
    in relevance to the figures submitted, and how they should be
    used.     In effect there has been a failure of proof, because
    the     figures     used   by   the    referee     and    his    calcula.tions
    therefrom are demonstrably mathematically and statistically
    unsound.      Worse, this playing with numbers distracts the
    parties     and     the    court     from   the    real   purpose    of     our
    determination here, did a "work stoppage" occur within the
    meaning of the unemployment insurance law.
    As we noted in the recent City - Billings 
    case, supra
    ,
    of
    Montana has aligned itself with those courts holding on the
    question     that    the    phrase    "stoppage of        work"    refers   to
    employer's        operations       rather   than     to    the     individual
    employee's work, and that strikers may collect benefits under
    the "American rule" so long as their activities have not
    substantially curtailed the productive operations of their
    employer.     The record clearly supports the Board of Labor
    Appeals in its finding that here the business of the employer
    was to mine and deliver coal to customers and that there is
    no substantial showing of unfulfilled customer demands nor
    any    curtailment     in    its   deliveries    of   coal    to   its   two
    principal customers.         This means that a "stoppage of work" as
    that    term   is    contemplated     in   the    present     unemployment
    insurance law, had not occurred in this case.                By that fact,
    the claims of the claimants for benefits may not be denied.
    Again we point out, as we did in City - Billings,
    
    of supra
    , that the wisdom or even the fairness of the economic
    legislation we are considering here is not before us nor do
    we pass upon its merits.            Determination of state economic
    policy is for the legislature.             It is in the arena of the
    legislature where labor and management can face off that
    state economic policy in this matter can be decided.
    Accordingly,    the    judgment of       the District Court       is
    reversed and the order of the Board of Labor Appeals is
    reinstated.
    We Concur:
    Chief Justice
    Justices
    Mr. Chief Justice Frank I. Haswell, Justice L. C. Gulbrandson
    and Justice Fred J. Weber will file separate opinions later.
    DISSENT
    NO. 82-359
    DECKER COAL COMPANY   V.   ESD
    Mr. Chief Justice Frank I. Haswell, Mr. Justice L .        C.
    Gulbrandson and Mr. Justice Fred J. Weber, dissenting.
    We would remand the case to the District Court for
    judicial review under the correct standard of review in the
    Unemployment Compensation Act.
    Our view in this case on the correct standard of review
    and the respective functions of the Board of Labor Appeals
    and the District Court are set forth in our dissent in Cause
    No.   82-106, City of Billings v. State of Montana Board of
    Labor Appeals et al., 40 St.Rep. 648.
    

Document Info

Docket Number: 82-359

Filed Date: 7/5/1983

Precedential Status: Precedential

Modified Date: 10/30/2014